Inactivation of the tumor suppressor adenomatous polyposis coli, with the resultant activation of beta-catenin, is the initiating event in the development of a majority of colorectal cancers. Krüppel-like factor 5 (KLF5), a proproliferative transcription factor, is highly expressed in the proliferating intestinal crypt epithelial cells. To determine whether KLF5 contributes to intestinal adenoma formation, we examined tumor burdens in Apc(Min/+) mice and Apc(Min/+)/Klf5(+/-) mice. Compared with Apc(Min/+) mice, Apc(Min/+)/Klf5(+/-) mice had a 96% reduction in the number of intestinal adenomas. Reduced tumorigenicity in the Apc(Min/+)/Klf5(+/-) mice correlated with reduced levels and nuclear localization of beta-catenin as well as reduced expression of two beta-catenin targets, cyclin D1 and c-Myc. In vitro studies revealed a physical interaction between KLF5 and beta-catenin that enhanced the nuclear localization and transcriptional activity of beta-catenin. Thus, KLF5 is necessary for the tumor-initiating activity of beta-catenin during intestinal adenoma formation in Apc(Min/+) mice, and reduced expression of KLF5 offsets the tumor-initiating activity of the Apc(Min) mutation by reducing the nuclear localization and activity of beta-catenin.