Amplification and elevated expression of the ErbB2 receptor tyrosine kinase occurs in 20% of human breast cancers and is associated with a poor prognosis. We have previously demonstrated that mammary tissue-specific expression of activated ErbB2 under the control of its endogenous promoter results in mammary tumor formation. Tumor development was associated with amplification and overexpression of ErbB2 at both the transcript and protein levels. Here we demonstrate that the EGR2/Krox20 transcription factor and its coactivator CITED1 are coordinately upregulated during ErbB2 tumor induction. We have identified an EGR2 binding site in the erbB2 promoter and demonstrated by chromatin immunoprecipitation assays that EGR2 and CITED1 associate specifically with this region of the promoter. EGR2 and CITED1 were shown to associate, and expression from an erbB2 promoter-reporter construct was stimulated by EGR2 and was further enhanced by CITED1 coexpression. Furthermore, expression of the 14-3-3sigma tumor suppressor led to downregulation of ErbB2 protein levels and relocalization of EGR2 from the nucleus to the cytoplasm. Taken together, these observations suggest that, in addition to an increased gene copy number and upregulation of EGR2 and CITED1, an elevated erbB2 transcript level involves the loss of 14-3-3sigma, which sequesters a key transcriptional regulator of the erbB2 promoter.