PTEN is a tumor suppressor gene frequently mutated in human cancers. In vitro and in vivo studies have shown that PTEN can exert its tumor suppressive function through a variety of mechanisms, including regulation of cell death and cell proliferation. However, it is still unclear which of the many downstream pathways are critical in each different tissue, in vivo. Loss of PTEN is the earliest detectable genetic lesion in the estrogen-related type I (endometrioid) endometrial cancer. Pten(+/-) mice develop endometrial neoplastic lesions with full penetrance, thus providing a model system to dissect the genetic and biochemical events leading to the transition from normal to hyperplastic and neoplastic endometrial epithelium. Here, we show that loss of Pten in the mouse endometrium activates Akt and results in increased phosphorylation of estrogen receptor alpha (ERalpha) on Ser(167). ERalpha phosphorylation results, in turn, in the activation of this nuclear receptor both in vivo and in vitro, even in the absence of ligand, and in its increased ability to activate the transcription of several of its target genes. Strikingly, reduction of endometrial ERalpha levels and activity dramatically reduces the neoplastic effect of Pten loss in the endometrium, in contrast to complete estrogen depletion. Thus, we provide for the first time in vivo evidence supporting the hypothesis that loss of Pten and subsequent Akt activation result in the activation of ERalpha-dependent pathways that play a pivotal role in the neoplastic process.