To elucidate a role of ΔNp63α in breast cancer, the expression levels of p63, estrogen receptor, progesterone receptor, p53, CK5, cerBb‐2, and Notch1 were assayed in 50 clinical breast cancer specimens using immunochemistry. P63 was highly expressed in a subset of breast cancer with basal‐like features. We then transfected MCF7 cells with ΔNp63α plasmid, and assayed its cancer stem cell‐like features after transfection. Overexpression of ΔNp63α in MCF7 cells increased the percentage of CD24⁻CD44⁺ subpopulation from 2.2 ± 0.2% to 25.1 ± 1.5% (P < 0.05) and led to increased cancer cell proliferation, clonogenicity, anchorage‐independent growth, and the incidence of xenograft grown in vivo. In addition, ΔNp63α overexpressing cancer cells were more drug resistant. Further studies suggested ΔNp63α‐induced activation of the Notch pathway may play a role in these effects. Chromatin immunoprecipitation confirmed that ΔNp63α could directly bind to Notch1. In clinical breast cancer specimens, the expression level of p63 was also found to positively correlate with the expression level of Notch1. Our results suggest that ΔNp63α might serve as a tumor initiating transcription factor in breast cancer. (Cancer Sci 2010; 101: 2417–2424)