De novo or acquired resistance to tamoxifen is a major clinical challenge for the management of estrogen receptor (ER)-positive breast cancers. Although cyclin D1 overexpression is associated with a better outcome for breast cancer patients, its overexpression is also linked to tamoxifen resistance. We previously reported that the beneficial effect of cyclin D1 correlates with its ability to repress the antiapoptotic transcription factor signal transducer and activator of transcription 3 (STAT3). In contrast, molecular pathways linking overexpression of cyclin D1 to tamoxifen resistance have not been established. In the current study, the effect of tamoxifen on the growth of genetically matched high or low cyclin D1-expressing breast cancer cells was characterized and the interactions between cyclin D1, ER, and STAT3 in response to tamoxifen treatment were determined. We show that repression of STAT3 by cyclin D1 inhibits cell growth on Matrigel and in tumors in vivo; however, treatment with tamoxifen abolishes cyclin D1-mediated repression of STAT3 and growth suppression. We show that tamoxifen induces a redistribution of cyclin D1 from STAT3 to the ER, which results in the activation of both STAT3 and the ER. These results offer a molecular mechanism for the dual effect of cyclin D1 overexpression in breast cancer and support the notion that the level of cyclin D1 expression and activated STAT3 are important markers to predict response to tamoxifen treatment.