Complement is operative in not only the extracellular but also the intracellular milieu. However, little is known about the role of complement activation inside tumor cells. Here, we report that intracellular C5 is cleaved by cathepsin D (CTSD) to produce C5a in lysosomes and endosomes of colonic cancer cells. After stimulation by C5a, intracellular C5aR1 assembles a complex with KCTD5/cullin3/Roc-1 and β-catenin to promote the switch of polyubiquitination of β-catenin from K48 to K63, which enhances β-catenin stability. Genetic loss or pharmacological blockade of C5aR1 dramatically impedes colorectal tumorigenesis at least by destabilizing β-catenin. In human colorectal cancer specimens, high levels of C5aR1, C5a, and CTSD are closely correlated with elevated β-catenin levels and a poor prognosis. Importantly, intracellular C5a/C5aR1-mediated β-catenin stabilization is also observed ubiquitously in other cell types. Collectively, we identify a machinery for β-catenin activation and provide a potential target for tumor prevention and treatment.