Ku70, a known nonhomologous end-joining (NHEJ) factor, also functions in tumor suppression, although this molecular mechanism remains uncharacterized. Previously, we showed that mice deficient for DNA ligase IV (Lig4), another key NHEJ factor, succumbed to aggressive lymphoma in the absence of tumor suppressor p53. However, the tumor phenotype is abrogated by the introduction of a hypomorphic mutant p53R172P, which impaired p53-mediated apoptosis but not cell-cycle arrest. However, Lig4-/-p53R172P mice succumbed to severe diabetes. To further elucidate the role of NHEJ and p53-mediated apoptosis in vivo, we bred Ku70-/- p53R172P mice. Unexpectedly, these mice were free of diabetes, although 80% of the mutant mice had abnormally enlarged colons with pronounced inflammation. Remarkably, most of these mutant mice progressed to dysplasia, adenoma and adenocarcinoma; this is in contrast to the Lig4-/-p53R172P phenotype, strongly suggesting an NHEJ-independent function of Ku70. Significantly, our analyses of Ku70-/-p53R172P colonic epithelial cells show nuclear stabilization of β-catenin accompanied by higher expression of cyclin D1 and c-Myc in affected colon sections than in control samples. This is not due to the p53 mutation, as Ku70-/- mice share this phenotype. Our results not only unravel a novel function of Ku70 essential for colon homeostasis, but also establish an excellent in vivo model in which to study how chronic inflammation and abnormal cellular proliferation underlie tumorigenesis and tumor progression in the colon.