Dysregulation of canonical Wnt signaling is thought to play a role in colon carcinogenesis. β-Catenin, a key mediator of the pathway, is stabilized upon Wnt activation and accumulates in the nucleus, where it can interact with the transcription factor T cell factor (TCF) to transactivate gene expression. Normal colonic epithelia express a truncated TCF-1 form, called dnTCF-1, that lacks the critical β-catenin-binding domain and behaves as a transcriptional suppressor. How the cell maintains a balance between the two forms of TCF-1 is unclear. Here, we show that ERM-binding phosphoprotein 50 (EBP50) modulates the interaction between β-catenin and TCF-1. We observed EBP50 localization to the nucleus of human colorectal carcinoma cell lines at low cell culture densities and human primary colorectal tumors that manifested a poor clinical outcome. In contrast, EBP50 was primarily membranous in confluent cell lines. Aberrantly located EBP50 stabilized conventional β-catenin/TCF-1 complexes and connected β-catenin to dnTCF-1 to form a ternary molecular complex that enhanced Wnt/β-catenin signaling events, including the transcription of downstream oncogenes such as c-Myc and cyclin D1. Genome-wide analysis of the EBP50 occupancy pattern revealed consensus binding motifs bearing similarity to Wnt-responsive element. Conventional chromatin immunoprecipitation assays confirmed that EBP50 bound to genomic regions highly enriched with TCF/LEF binding motifs. Knockdown of EBP50 in human colorectal carcinoma cell lines compromised cell cycle progression, anchorage-independent growth, and tumorigenesis in nude mice. We therefore suggest that nuclear EBP50 facilitates colon tumorigenesis by modulating the interaction between β-catenin and TCF-1.