Breast cancer is the second biggest cancer-related killer of women in the UK. The molecular mechanisms underlying how extended periods of lactation protect against breast cancer initiation and progression remain unknown. Here, the milk protein alpha-casein is shown to inhibit breast tumourigenesis both through directly affecting the cancer cells, and by affecting the cancer cell-stromal interactions. Alpha-casein is demonstrated to inhibit cancer stem cell characteristics such as mammosphere formation and ALDH activity in the highly metastatic, triple negative MDA-MB-231 breast cancer cell line. Mechanistically, alpha-casein inhibits HIF-1alpha signalling in MDA-MB-231 breast cancer cells, where hypoxia and HIF-1alpha activation are reported to promote tumour progression and metastasis. The data herein demonstrate that HIF-1alpha signalling is up-regulated by STAT1 and STAT3 transcription factors, downstream of IFN-gamma, which is itself shown to increase breast cancer stem cell activity. MDA-MB-231 breast cancer cells overexpressing IFN-gamma showed greater than 2-fold increase in MFE and ALDH activity. Specific STAT3 inhibitors were highly effective in reducing the CSC activity of this aggressive breast cancer cell line in vitro, and this correlated with a decrease in HIF-1alpha signalling. MDA MB-231 breast cancer cells were shown to activate HIF-1alpha and NF-kappaB signalling in fibroblasts. Activation of these pathways suggests transformation of stromal fibroblasts to tumour-promoting cancer associated fibroblasts (CAFs). Alpha-casein reduces tumour cell-induced fibroblast activation, even at low concentrations. STAT transcription factors are regulated by alpha-casein in fibroblasts, and their chemical inhibition results in a decrease in HIF-1alpha signalling. Overall, this work establishes a role for STAT1 in regulating HIF-1alpha in the tumour microenvironment, and establishes for the first time a role of alpha-casein in inhibitng STAT3, upstream of HIF-1alpha in normoxic conditions. Taken together, these results highlight STAT1 and STAT3 as potential therapeutic targets in the treatment of aggressive triple negative breast cancer.