Ovarian endometrioid adenocarcinomas (OEAs) frequently exhibit constitutive activation of canonical WNT signaling, usually as a result of oncogenic mutations that stabilize and dysregulate the β-catenin protein. In previous work, we used microarray-based methods to compare gene expression in OEAs with and without dysregulated β-catenin as a strategy for identifying novel β-catenin/TCF target genes with important roles in ovarian cancer pathogenesis. Among the genes highlighted by the microarray studies was MSX2, which encodes a homeobox transcription factor. We found MSX2 expression was markedly increased in primary human and murine OEAs with dysregulated β-catenin compared with OEAs with intact β-catenin regulation. WNT pathway activation by WNT3a ligand or GSK3β inhibitor treatment potently induced MSX2 and ectopic expression of a dominant negative form of TCF4 inhibited MSX2 expression in ovarian cancer cells. Chromatin immunoprecipitation studies demonstrated that β-catenin/TCF directly regulates MSX2 expression via binding to TCF binding elements in multiple regions of the MSX2 gene. Notably, ectopic MSX2 expression was found to promote neoplastic transformation of the rodent RK3E model epithelial cell line and to enhance the invasiveness of immortalized human ovarian epithelial cells in vitro and ovarian carcinoma cells in vivo. Inhibition of endogenous MSX2 expression in ovarian endometrioid cancer cells carrying a β-catenin mutation using shRNA approaches inhibited neoplastic properties of the cells in vitro and in vivo. Expression of MSX2 in selected ovarian carcinoma cells induced changes suggestive of epithelial-mesenchymal transition (EMT), but based on analysis of ovarian cell lines and primary tumor tissues, effects of MSX2 on EMT appear to be complex and context-dependent. Our findings indicate MSX2 is a direct downstream transcriptional target of β-catenin/TCF and has a key contributing role in the cancer phenotype of OEAs carrying WNT/β-catenin pathway defects.