The canonical Wnt signaling pathway activates the transcriptional activity of β-catenin. This pathway is often activated in colorectal cancer cells, but strategies to block it in tumors have not been effective. The SAM pointed domain containing ETS transcription factor (SPDEF) suppresses formation of colon tumors by unclear mechanisms. We investigated these mechanisms and the effects of SPDEF on β-catenin activity in mouse models of colorectal cancer (CRC), CRC cell lines, and mouse and human normal and cancer colonoids. We performed studies of Lgr5CreERT2; β-cateninexon3; Rosa26LSL-rtta-ires-EGFP; TRE-Spdef mice, which express an oncogenic form of β-catenin in Lgr5-positive ISCs upon administration of tamoxifen and SPDEF upon administration of tetracycline. CRC lines (HCT116 and SW480) were engineered to express inducible tagged SPDEF or vector (control) and subcutaneously injected into immunodeficient NSG mice. We generated SPDEF-inducible human colonoids, including a line derived from normal rectal mucosa (control) and an adenocarcinoma line derived from a patient with germline MUTYH mutation. Full-length and truncated forms of SPDEF were expressed in CRC cells; cells were assayed for β-catenin activity and studied in immunoprecipitation and chromatin immunoprecipitation assays. Expression of SPDEF was sufficient to inhibit intestinal tumorigenesis by activated β-catenin, block tumor cell proliferation, and restrict growth of established tumors. In tumor cells with activated β -catenin, expression of SPDEF induced a quiescent state, which was reversed when SPDEF expression was stopped. In mouse and human normal and tumor-derived enteroids/colonoids, those that expressed SPDEF for 3 days were significantly smaller. SPDEF inhibited the transcriptional activity of β-catenin via a protein-protein interaction, independent of SPDEF DNA binding capacity. SPDEF disrupted β-catenin binding to TCF1 and TCF3, displacing β-catenin from enhancer regions of genes that regulate the cell cycle but not genes that regulate stem cell activities. In studies of mice and human CRC, we found that SPDEF induces a quiescent state in CRC cells by disrupting binding of β-catenin to TCF1 and TCF3 and regulation of genes that control the cell cycle. In this model, β-catenin activity determines the proliferation or quiescence of CRC cells based on the absence or presence of SPDEF. Copyright © 2017 AGA Institute. Published by Elsevier Inc. All rights reserved.