The caudal-related homeobox gene, CDX1, encodes for an intestinal-specific transcription factor and is involved in the induction of intestinal metaplasia (IM) of the stomach in gastric cancer. Gastric IM induced by bile reflux is a precancerous gastric adenocarcinomal lesion and has been associated with the induction of cyclooxygenase-2 (COX-2). In this study, we demonstrate the molecular mechanisms underlying the transcriptional regulation of COX-2 by bile acid in gastric cells. We noted that the ectopic expression of CDX1 enhanced COX-2 gene expression and that bile acid was associated with the induction of CDX1 expression. Furthermore, the induction of CDX1 by bile acid was mediated by the orphan nuclear receptor, small heterodimer partner (SHP). Finally, it was verified that the expression of COX-2, CDX1, SHP and CCAAT element-binding protein beta messenger RNA in human IM lesions were significantly higher than in lesions associated with gastritis. Collectively, these results reveal that bile acid induces an increase in the gene expression of COX-2 via the sequential transcriptional induction of SHP and CDX1 in precancerous lesions of human gastric cancer.