Estrogen synthesis in adipose tissue is associated with the development of breast cancer. Tumors are preferentially found in breast quadrants with strongest expression of the cytochrome P450 aromatase (encoded by the gene CYP19A1). Several promoters regulated by various hormonal factors drive aromatase expression in human breast adipose fibroblasts (BAFs). As adipose tissue is a major source of retinoids, in this study, we investigated their role in the regulation of aromatase expression. The retinoids all-trans-retinoic acid (at-RA) and 9-cis-RA induce aromatase activity in human BAFs. In BAFs, at-RA induces aromatase gene expression via promoter I.4. In 3T3-L1 cells, both retinoids specifically drive luciferase reporter gene expression under the control of aromatase promoter I.4, whereas other promoters active in human adipose tissue are insensitive. Activation by retinoids depends on a 467 bp fragment (-256/+211) of promoter I.4 containing four putative retinoic acid response elements (RAREs). Site-directed mutagenesis revealed that only RARE2 (+91/+105) mediates the retinoid-dependent induction of reporter gene activity. In 3T3-L1 preadipocytes and human BAFs, RA receptor α (RARα (RARA)) expression is predominant, whereas RARβ (RARB) or RARγ (RARG) expression is low. Electrophoretic mobility shift assays with nuclear extracts obtained from human BAFs and 3T3-L1 cells identified a specific RARE2-binding complex. Retinoids enhanced complex formation, whereas pre-incubation with anti-RARα antibodies prohibited the binding of RARα to RARE2. Chromatin immunoprecipitation showed RA-dependent binding of RARα to the RARE2-containing promoter region in vivo. Furthermore, we provide evidence that RARE2 is also necessary for the basal activation of promoter I.4 in these cells. Taken together, these findings indicate a novel retinoid-dependent mechanism of aromatase activity induction in adipose tissue.