In mammals, lactation is a rich source of nutrients and antibodies for newborn animals. However, millions of mothers each year experience an inability to breastfeed. Exposure to several environmental toxicants, including 2,3,7,8-tetrachlorodibenzo-p-dioxin (TCDD), has been strongly implicated in impaired mammary differentiation and lactation. TCDD and related polyhalogenated aromatic hydrocarbons are widespread industrial pollutants that activate the aryl hydrocarbon receptor (AHR). Despite many epidemiological and animal studies, the molecular mechanism through which AHR signaling blocks lactation remains unclear. We employed in vitro models of mammary differentiation to recapitulate lactogenesis in the presence of toxicants. We demonstrate AHR agonists directly block milk production in isolated mammary epithelial cells. Moreover, we define a novel role for the aryl hydrocarbon receptor repressor (AHRR) in mediating this response. Our mechanistic studies suggest AHRR is sufficient to block transcription of the milk gene β-casein. As TCDD is a prevalent environmental pollutant that affects women worldwide, our results have important public health implications for newborn nutrition.