Enhanced stemness in colorectal cancer has been reported and it contributes to aggressive progression, but the underlying mechanisms remain unclear. Here we report a Wnt ligand, Dickkopf-2 (DKK2) is essential for developing colorectal cancer stemness. Genetic depletion of DKK2 in intestinal epithelial or stem cells reduced tumorigenesis and expression of the stem cell marker genes including LGR5 in a model of colitis-associated cancer. Sequential mutations in APC, KRAS, TP53, and SMAD4 genes in colonic organoids revealed a significant increase of DKK2 expression by APC knockout and further increased by additional KRAS and TP53 mutations. Moreover, DKK2 activates proto-oncogene tyrosine-protein kinse Src followed by increased LGR5 expressing cells in colorectal cancer through degradation of HNF4 alpha 1 protein. These findings suggest that DKK2 is required for colonic epithelial cells to enhance LGR5 expression during the progression of colorectal cancer.