The mammary gland consists of numerous tissue compartments, including mammary epithelium, an array of stromal cells, and the extracellular matrix (ECM). Bidirectional interactions between the epithelium and its surrounding stroma are essential for proper mammary gland development and homeostasis, whereas their deregulation leads to developmental abnormalities and cancer. To study the relationships between the epithelium and the stroma, development of models that could recapitulate essential aspects of these interacting systems in vitro has become necessary. Here we describe a three-dimensional (3D) co-culture assay and show that the addition of fibroblasts to mammary organoid cultures promotes the epithelium to undergo branching morphogenesis, thus allowing the role of the stromal microenvironment to be examined in this essential developmental process.