The mammary gland is unusual in that most development occurs in the adult. At birth, the gland comprises a rudimentary branched structure that elongates and branches during puberty to fill the fat pad. Ducts are comprised of a polarized bilayered epithelium of luminal and basal cells, the latter being primarily differentiated myoepithelium. At the onset of pregnancy, the alveolar lineage arises from progenitors that are stimulated to proliferate and generate lobuloalveolar structures, comprised of luminal and basal cells, which subsequently differentiate to produce milk and are thus essential for survival of the offspring (Hennighausen and Robinson 2005). These distinct epithelial cell types arise from a common multipotent stem cell (Shackleton et al. 2006; Stingl et al. 2006). Stat5a is essential for mammary gland development during pregnancy and formation of lobuloalveolar structures, as germline deletion of stat5a resulted in impaired alveologenesis and lactation failure (Liu et al. 1997). This lactation defect can be rescued in subsequent pregnancies by elevated expression of Stat5b (Liu et al. 1998). Consequently, deletion of both stat5a/b genes in mammary epithelium severely impairs alveologenesis (Cui et al. 2004), and this can be rescued by transgenic expression of Stat5a in stat5a/b-null mammary cells during pregnancy (Yamaji et al. 2009). The latter study demonstrated that Stat5a is required for the generation and/or expansion of alveolar luminal progenitor cells from mammary stem cells (Yamaji et al. 2009). The Ets transcription factor Elf5 has been suggested to be a master regulator of alveologenesis, as conditional deletion of Elf5 in both luminal and basal cells of the mammary gland resulted in a complete failure to develop the secretory epithelium (Choi et al. 2009). Conversely, overexpression of Elf5 in virgin mammary glands using an inducible transgenic model resulted in precocious alveologenesis and milk secretion (Oakes et al. 2008). This resulted in a diminution in number of luminal progenitor cells that express CD61 (β3 integrin), while in Elf5-null glands, CD61+ luminal progenitor cells accumulated, suggesting a block in differentiation. The connection between Stat5a and Elf5, both downstream targets of prolactin signaling, is not clear. Elf5 has been shown to bind to the proximal stat5a gene promoter in late pregnancy, and levels of Stat5a are down-regulated in Elf5-deficient mammary epithelial cells (Choi et al. 2009). However, Stat5a/b-null luminal progenitor cells do not express Elf5, and there are multiple consensus Stat-binding sites in the distal region of the Elf5 gene promoter (Yamaji et al. 2009), suggesting that there could be a positive regulatory loop between Stat5 and Elf5. Gata-3, which is expressed in the luminal cells, is required to specify and maintain the differentiation status of luminal epithelial cells (Kouros-Mehr et al. 2006; Asselin-Labat et al. 2007). Conditional deletion of Gata-3 during gestation resulted in detachment of cells from the basement membrane, resulting in cell death and lactation failure (Kouros-Mehr et al. 2006). CD61+ luminal progenitors also accumulated in Gata-3-null mammary glands (Asselin-Labat et al. 2007). Stat6 and IL-4/IL-13 are upstream regulators of Gata-3, and these signaling molecules are required for efficient lobuloalveologenesis, as there was a considerable delay in proliferation and differentiation in the absence of Stat6 or IL-4/IL-13 (Khaled et al. 2007). A microarray analysis of 5-d-gestation (5dG) mammary tissue revealed that the most up-regulated transcript in stat6−/− tissue was a previously undescribed gene, zinc finger protein 157 (zfp157). In this study, we explore the function of Zfp157 in alveologenesis and reveal that this transcriptional regulator controls the balance of luminal populations and is a critical mediator of Gata-3 signaling.