Stem cells and progenitors in many lineages undergo self-renewing divisions, but the extracellular and intracellular proteins that regulate this process are largely unknown. Glucocorticoids stimulate red blood cell formation by promoting self-renewal of early burst-forming unit–erythroid (BFU–E) progenitors^,,,. Here we show that the RNA-binding protein ZFP36L2 is a transcriptional target of the glucocorticoid receptor (GR) in BFU–Es and is required for BFU–E self-renewal. ZFP36L2 is normally downregulated during erythroid differentiation from the BFU–E stage, but its expression is maintained by all tested GR agonists that stimulate BFU–E self-renewal, and the GR binds to several potential enhancer regions of ZFP36L2. Knockdown of ZFP36L2 in cultured BFU–E cells did not affect the rate of cell division but disrupted glucocorticoid-induced BFU–E self-renewal, and knockdown of ZFP36L2 in transplanted erythroid progenitors prevented expansion of erythroid lineage progenitors normally seen following induction of anaemia by phenylhydrazine treatment. ZFP36L2 preferentially binds to messenger RNAs that are induced or maintained at high expression levels during terminal erythroid differentiation and negatively regulates their expression levels. ZFP36L2 therefore functions as part of a molecular switch promoting BFU–E self-renewal and a subsequent increase in the total numbers of colony-forming unit–erythroid (CFU–E) progenitors and erythroid cells that are generated.