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 HNF4α1 protein. These findings suggest that DKK2 is required for colonic epithelial cells to enhance LGR5 expression during the progression of colorectal cancer.