Chronic inflammation of mucosal surfaces renders them increasingly susceptible to epithelial cancers both in humans and mice. We have previously shown that anti-inflammatory CD4(+)CD45RB(lo)CD25(+) regulatory (Treg or T(R)) lymphocytes down-regulate inflammation and block development of bacteria-triggered colitis and colorectal cancer (CRC) in 129/SvEv Rag2-/- mice. Interestingly, T(R) cells collected from Interleukin (IL)-10-deficient cell donors not only failed to suppress carcinogenesis but instead promoted invasive mucinous colonic carcinoma with a strong gender bias expressing in male mice. We found we show that peritoneal invasion in this model is dependent on pleiotropic cytokine IL-6. Mucinous carcinoma arose rapidly and consistently after treatment with IL10-/- T(R) cells, which were found to express Foxp3+ and localize throughout tumor tissue. Carcinogenesis was rapidly reversible with transfer of wild type IL10-competent T(R) cells. Likewise, treatment with IL10-Ig fusion protein was sufficient to revert the lesions histologically, and restore inflammatory cytokine and oncogene expression to base line levels. These studies indicate an essential role for IL 6 in this CRC phenotype. Furthermore, immune-competent T(R) cells were important not only for preventing pathology but also for constructive remodeling of bowel following tumorigenic microbial insults. These data provide insights into etiopathogenesis of inflammation-associated epithelial invasion and maintenance of epithelial homeostasis.