The carcinoembryonic antigen cell adhesion molecule 1 (CEACAM1) is downregulated in colonic and intestinal hyperplastic lesions as well as in other cancers, where it functions as a tumor suppressor. To investigate the functions of CEACAM1 in the normal intestine and in intestinal tumors, we generated a compound knockout mouse model and examined both Ceacam1(-/-) and Apc(1638N/+):Ceacam1(-/-) mice. Ceacam1(-/-) intestinal cells exhibited a significant decrease in apoptosis, with no change in proliferation or migration, however. Compound Apc(1638N/+):Ceacam1(-/-) mice demonstrated an increase in intestinal tumor multiplicity and tumor progression. Increases in intussusceptions and desmoid lesions were also observed. We have shown that CEACAM1-L associates with beta-catenin by co-immunoprecipitation and colocalization in CEACAM1-L-transfected CT26 and CT51 mouse colon carcinoma cells. Ceacam1(-/-) enterocytes displayed decreased glycogen synthase kinase 3-beta activity with corresponding nuclear localization of beta-catenin. Increased T-cell factor/Lef transcriptional activity was observed in CEACAM1-null CT51 colonic cells and in Caco2 colon cancer cells in which CEACAM1 was downregulated. A significant increased expression in c-Myc and cyclin D1 targets of the Wnt signaling pathway was also revealed in the Ceacam1(-/-) intestine. CEACAM1 therefore actively participates in Wnt signaling in intestinal cells and its downregulation in intestinal tissue contributes to malignancy by augmenting tumor multiplicity and progression.