The idea that susceptibility to breast cancer is determined not only through inherited germline mutations but also by epigenetic changes induced by alterations in hormonal environment during fetal development is gaining increasing support. Using findings obtained in human and animal studies, this review addresses the mechanisms that may explain why daughters of mothers who took synthetic estrogen diethylstilbestrol (DES) during pregnancy have two times higher breast cancer risk than women who were not exposed to it. The mechanisms likely involve epigenetic alterations, such as increased DNA methylation and modifications in histones and microRNA expression. Further, these alterations may target genes that regulate stem cells and prevent differentiation of their daughter cells. Recent findings in a preclinical model suggest that not only are women exposed to DES in utero at an increased risk of developing breast cancer, but this risk may extend to their daughters and granddaughters as well. It is critical, therefore, to determine if the increased risk is driven by epigenetic alterations in genes that increase susceptibility to breast cancer and if these alterations are reversible.