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Chronic inflammation predisposes tissue to cancer development. Individuals afflicted with inflammatory bowel diseases are at an increased risk of developing colorectal cancer depending on disease severity, duration, and management. The intestinal epithelium exhibits mitochondrial dysfunction during colitis and colitis-associated cancer. Signal Transducer and Activator of Transcription (Stat)-3 is a transcription factor involved in growth-promoting and antiapoptotic signaling pathways. In addition to its activities as a transcription factor, Stat3 resides in the mitochondria of cells where it is required for optimal electron transport chain activity and protects against stress-induced mitochondrial dysfunction. The function of mitochondrial Stat3 is not completely understood; dichotomous roles include protecting against cellular injury but also supporting malignant transformation. This review discusses the roles of Stat3 in the regulation of intestinal epithelial cell fate during colitis and colorectal cancer with an emphasis on mitochondrial dysfunction and the potential involvement of mitochondrial Stat3 during disease progression.