The two, nearly identical, isoforms of human progesterone receptors (PR), PR-B and -A, share activation functions (AF) 1 and 2, yet they possess markedly different transcriptional profiles, with PR-B being much stronger transactivators. Their differences map to a unique AF3 in the B-upstream segment (BUS), at the far N terminus of PR-B, which is missing in PR-A. Combined mutation of two LXXLL motifs plus tryptophan 140 in BUS, to yield PR-BdL140, completely destroys PR-B activity, because strong AF3 synergism with downstream AF1 and AF2 is eliminated. This synergism involves cooperative interactions among receptor multimers bound at tandem hormone response elements and is transferable to AFs of other nuclear receptors. Other PR-B functions-N-/C-terminal interactions, steroid receptor coactivator-1 coactivation, ligand-dependent down-regulation-also require an intact BUS. All three are autonomous in PR-A, and map to N-terminal regions common to both PR. This suggests that the N-terminal structure adopted by the two PR is different, and that for PR-B, this is controlled by BUS. Indeed, gene expression profiling of breast cancer cells stably expressing PR-B, PR-BdL140, or PR-A shows that mutation of AF3 destroys PR-B-dependent gene transcription without converting PR-B into PR-A. In sum, AF3 in BUS plays a critical modulatory role in PR-B, and in doing so, defines a mechanism for PR-B function that is fundamentally distinct from that of PR-A.