Between 5% and 10% of breast cancer cases result from an inherited predisposition. The majority of hereditary forms of breast and ovarian cancer can be accounted for by mutations in two recently identified genes, BRCA1 and BRCA2. Inactivating mutations have been found throughout both genes, and the majority are predicted to result in truncated proteins. Surprisingly, whereas germline mutations have been identified in a growing number of breast or breast and ovarian cancer families, few mutations have been reported in sporadic forms of breast or ovarian cancer. Alternative mechanisms of inactivation have been proposed, but there is currently no strong evidence that these genes are involved in sporadic forms of cancer. Recent studies suggest a role for BRCA1 in transcriptional regulation, as it possesses a conserved amino terminal RING finger domain and an acidic carboxyl domain. Although this role would be consistent with the reported localization of the BRCA1 protein to the nucleus, a cytoplasmic localization and a secretory role for BRCA1 has also been proposed. Current findings suggest that BRCA1 may play an as yet undefined protective role in cells, as it is strongly expressed in epithelial cells undergoing high levels of proliferation in association with differentiation.