Background Familial medullary thyroid cancer (MTC) is associated with germline RET mutations causing multiple endocrine neoplasia type 2 (MEN2). The majority of germline RET mutations predisposing to MEN2 result in single amino acid substitutions causing inappropriate constitutive RET activation. However, some rare families with apparent MTC predisposition do not have a detectable RET mutation (non-RET), suggesting that further predisposing gene alterations remain to be identified. Methods Here, we undertook exome sequencing studies in one family with apparent predisposition to non-ret MTC and identified a novel ESR2 frameshift mutation, c.948delT; p.G318Afs*22, which segregated with histological diagnosis following thyroid surgery. Sequencing of ESR2 in individuals with apparently isolated MTC identified a further novel germline missense alteration, c.382G > C; p.V128L in a female who developed MTC age 36 years. Results Functional assays showed that ESR2-V128L retained transcriptional activity with a significant increase in luciferase activity in response to ESR2-agonist DPN in HCT116 (3.7-fold; P < 0.01) and MCF-7 (1.8-fold; P < 0.05) cells. In contrast, ESR2-G318Afs*22 was incapable of inducing luciferase activity in either cell line (P = NS). Furthermore, ESR2-G318Afs*22 failed to inhibit ESR1 driven luciferase activity in response to either 17β-estradiol (E2) or ESR1-agonist PPT, or restrain ESR1-driven proliferation of MCF-7 cells. In contrast, wild-type (WT) ESR2 and ESR2-V128L inhibited ESR1-driven luciferase activity (>60%. P < 0.01) and cell proliferation (>30%, P < 0.05). As RET expression is known to be stimulated by oestrogen, we then determined the influence of ESR2 mutants on RET in E2- and PPT-treated HCT116 cells. In contrast to WT ESR2, ESR2-G318Afs*22 was unable to oppose ESR1- stimulation of the RET proto-oncogene at both the mRNA and protein level. Treatment with 4-hydroxytamoxifen was however capable of inhibiting E2-induced RET mRNA expression in cells with ESR2- G318Afs*22. Conclusions Together these data indicate an emerging role for ESR2 as a novel susceptibility gene in non-RET MTC development, especially as ESR2- G318Afs*22 was associated with elevated RET.