Prominin-1 (Prom1) is recognized as a stem cell marker in several tissues, including blood, neuroepithelium, and gut, and in human and mouse embryos and many cancers. Although Prom1 is routinely used as a marker for isolating stem cells, its biological function remains unclear. Here we use a knockout model to investigate the role of Prom1 in the mammary gland. We demonstrate that complete loss of Prom1 does not affect the regenerative capacity of the mammary epithelium. Surprisingly, we also show that in the absence of Prom1, mammary glands have reduced ductal branching, and an increased ratio of luminal to basal cells. The effects of Prom1 loss in the mammary gland are associated with decreased expression of prolactin receptor and matrix metalloproteinase-3. These experiments reveal a novel, functional role for Prom1 that is not related to stem cell activity, and demonstrate the importance of tissue-specific characterization of putative stem cell markers.