In most tissues, the prevailing view is that stem cell (SC) niches are generated by signals from within the nearby tissue environment. Here, we define genetic changes altered in hair follicle (HF) SCs in mice treated with a potent SC activator, cyclosporine A (CSA), which inhibits the phosphatase calcineurin (CN) and the activity of the transcription factor nuclear factor of activated T cells c1 (Nfatc1). We show that CN/Nfatc1 regulates expression of prolactin receptor (Prlr) and that canonical activation of Prlr and its downstream signaling via Jak/Stat5 drives quiescence of HF SCs during pregnancy and lactation, when serum prolactin (Prl) levels are highly elevated. Using Prl injections and genetic/pharmacological loss-of-function experiments in mice, we show that Prl signaling stalls follicular SC activation through its activity in the skin epithelium. Our findings define a unique CN-Nfatc1-Prlr-Stat5 molecular circuitry that promotes persistent SC quiescence in the skin.