BACKGROUND & AIMS: Chronic inflammation is a predisposing condition for colorectal cancer. Many studies to date have focused on proinflammatory signaling pathways in the colon. Understanding the mechanisms that suppress inflammation, particularly in epithelial cells, is critical for developing therapeutic interventions. Here, we explored the roles of transforming growth factor β (TGFβ) family signaling through SMAD4 in colonic epithelial cells. METHODS: The Smad4 gene was deleted specifically in adult murine intestinal epithelium. Colitis was induced by 3 rounds of dextran sodium sulfate in drinking water, after which mice were observed for up to 3 months. Nontransformed mouse colonocyte cell lines and colonoid cultures and human colorectal cancer cell lines were analyzed for responses to TGFβ1 and bone morphogenetic protein 2. RESULTS: Dextran sodium sulfate treatment was sufficient to drive carcinogenesis in mice lacking colonic Smad4 expression, with resulting tumors bearing striking resemblance to human colitis-associated carcinoma. Loss of SMAD4 protein was observed in 48% of human colitis-associated carcinoma samples as compared with 19% of sporadic colorectal carcinomas. Loss of Smad4 increased the expression of inflammatory mediators within nontransformed mouse colon epithelial cells in vivo. In vitro analysis of mouse and human colonic epithelial cell lines and organoids indicated that much of this regulation was cell autonomous. Furthermore, TGFβ signaling inhibited the epithelial inflammatory response to proinflammatory cytokines. CONCLUSIONS: TGFβ suppresses the expression of proinflammatory genes in the colon epithelium, and loss of its downstream mediator, SMAD4, is sufficient to initiate inflammation-driven colon cancer. Transcript profiling: GSE100082.