Loss of serine or threonine phosphorylation sites from exon 3 of beta-catenin has been identified in approximately half of colorectal tumors which lack adenomatous polyposis coli (APC) mutations, but the overall contribution of beta-catenin mutations to sporadic colorectal tumorigenesis is unclear. We therefore used PCR to amplify and sequence exon 3 of beta-catenin from 202 sporadic colorectal tumors. Exon 3 beta-catenin mutations were identified in 6 of 48 small (< 1 cm) adenomas, 2 of 82 large (> or =1 cm) adenomas, and 1 of 72 invasive carcinomas. Eight of the nine mutations, including all of those in the small adenomas and the invasive cancer, involved loss of serine or threonine phosphorylation sites. The percentage of beta-catenin mutations in small adenomas (12.5%) was significantly greater than that in large adenomas (2.4%) and invasive cancers (1.4%; P = 0.05 and P = 0.02, respectively). We conclude that mutation of beta-catenin can be an early, perhaps initiating, event in colorectal tumorigenesis. Small adenomas with beta-catenin mutations do not appear to be as likely to progress to larger adenomas and invasive carcinomas as other adenomas, however, with the result that beta-catenin mutations are only rarely seen in invasive cancers. This suggests that APC and beta-catenin mutations are not functionally equivalent, and that the APC gene may have other tumor suppressor functions besides the degradation of beta-catenin.