Inheritance of a major susceptibility gene for breast cancer has been primarily investigated in families with early‐onset disease. However, familial clustering of late‐onset breast cancer is well documented, and genetic factors may also be relevant. In the Iowa Women's Health Study, we evaluated evidence for a major gene after allowing for measured environmental risk factors. Two hundred sixty‐five incident breast cancer probands were identified from a prospective cohort study of 41,837 women aged 55 to 69 years at baseline in 1986. A pedigree development form was mailed to the probands to ascertain all first‐degree female relatives. A questionnaire and body measurement protocol were mailed to identified living relatives or surrogates. Segregation analyses were conducted on a total of 1,145 women in 251 families using regressive models as implemented in S.A.G.E. Mendelian codominant inheritance of an allele that produced an earlier age‐at‐onset provided the best fit to the data. Incorporation of measured environmental risk factors as covariates yielded no significant improvements in the likelihoods. Approximately 50% of this population could be expected to carry a late‐onset breast cancer susceptibility gene, and 23% of the population is susceptible because of the environment in which they live. Homozygous gene carriers are predicted to have a mean age‐at‐onset of 48 years, over 20 years earlier than heterozygotes; few cases would be expected among non‐gene carriers. In conclusion, the transmission pattern of late‐onset breast cancer may be determined by a common susceptibility gene. ©1995 Wiley‐Liss, Inc.