Colorectal cancer arises after a series of mutations in various tumor suppressor and proto-oncogenes, each of which is accompanied by specific alterations and pathological conditions. Recent advances have contributed a great deal of understanding of the molecular basis of events that lead to colorectal tumorigenesis. Mutation in the adenomatous polyposis coli (APC) gene is considered to be one of the earliest events in the colon cancer development. The familial adenomatous polyposis (FAP) and hereditary nonpolyposis colorectal cancer (HNPCC) are the most commonly inherited colorectal cancers. FAP and HNPCC develop due to mutations in APC and DNA mismatch repair (MMR) genes, respectively. APC is known to regulate the levels of beta-catenin, an important mediator of cell-cell adhesion and transcriptional regulator. Mutations in APC gene are also linked with chromosomal instability in colon cancer cells. The role of APC is also implicated in cell migration, cell-cell adhesion, cell cycle control, and apoptosis. This article summarizes the structure-function studies and the role of APC mutations in colon cancer development.