Clinical reports show males have a higher bladder cancer (BCa) incidence than females. The sexual difference of BCa occurrence suggests that estrogen and its receptors may affect BCa development. Estrogen receptor alpha (ERa) is the classic receptor to convey estrogen signaling, however, the function of ERa in BCa development remains largely unknown. To understand the in vivo role of ERa in BCa development, we generated total and urothelial specific ERa knockout mice (ERaKO) and used the pre-carcinogen BBN to induce BCa. Earlier reports showed that ERa promotes breast and ovarian cancers in females. Surprisingly and of clinical importance, our results showed that ERa inhibits BCa development and loss of the ERa gene results in an earlier onset and higher incidence of BBN-induced in vivo mouse BCa. Supportively, carcinogen induced malignant transformation ability was reduced in ERa expressing urothelial cells as compared to ERa negative cells. Mechanism studies suggest that ERa could control the expression of INPP4B to reduce AKT activity and consequently reduce BCa cell growth. In addition, IHC staining of clinical sample analyses show that INPP4B expression, in correlation with reduced ERa, is significantly reduced in human BCa specimens. Together, this is the first report using the in vivo cre-loxP gene knockout mouse model to characterize ERa roles in BCa development. Our studies provide multiple in vitro cell studies and in vivo animal model data as well as human BCa tissue analyses to prove ERa plays a protective role in BCa initiation and growth at least partly via modulating the INPP4B/Akt pathway.