Methylenetetrahydrofolate reductase (MTHFR) is a key enzyme in the folate metabolic pathway. We aimed to test the hypothesis that C677T and A1298C variants of MTHFR predispose to microsatellite instable (MSI) colorectal cancer. We determined MTHFR genotypes in 175 sporadic colorectal cancer patients and a total of 231 normal controls in Shiraz, Southern Iran. Among the genotypes found in our samples, MTHFR CT and CT+TT were associated with increased risk for CRC incidence [odds ratio (OR)=2.4, 95% confidence interval (95%CI)=1.8-4.4; OR=2.4, 95%CI=1.6-3.6, respectively]. Double heterozygotes 677CT/1298AC and double homozygote 677TT/1298AA and 677CC/1298CC genotypes also showed a significantly increased risk of developing CRC compared with the wild-type 677CC/1298AA genotypes of the controls. Among the 151 tumors tested, 36 (23.8%) were MSI+. MSI was more common in proximal tumors (OR=10.4; 95%CI=3.9-27.8) and in smokers (OR=2.9; 95%CI=1.3-6.7). In a case-control comparison, the MTHFR 677CT+TT genotype was strongly associated with MSI (OR=2.6; 95%CI=1.3-5.3). Hypermethylation of mismatch repair genes was positively related with MSI incidence in these tumor series (P=0.00). Our data suggest that the MTHFR 677CT+TT variant genotype may be a risk factor for MSI+ cancer.