Genome-wide association studies (GWAS) of colorectal cancer (CRC) have led to the identification of a number of common variants associated with modest risk. Several risk variants map within the vicinity of TGFβ/BMP signaling pathway genes, including rs4939827 within an intron of SMAD7 at 18q21.1. A previous study implicated a novel SNP (novel 1 or rs58920878) as a functional variant within an enhancer element in SMAD7 intron 4. In this study, we show that four SNPs including novel 1 (rs6507874, rs6507875, rs8085824, and rs58920878) in linkage disequilibrium (LD) with the index SNP rs4939827 demonstrate allele-specific enhancer effects in a large, multi-component enhancer of SMAD7. All four SNPs demonstrate allele-specific protein binding to nuclear extracts of CRC cell lines. Furthermore, some of the risk-associated alleles correlate with increased expression of SMAD7 in normal colon tissues. Finally, we show that the enhancer is responsive to BMP4 stimulation. Taken together, we propose that the associated CRC risk at 18q21.1 is due to four functional variants that regulate SMAD7 expression and potentially perturb a BMP negative feedback loop in TGFβ/BMP signaling pathways.