The hyperactivated Wnt/β-catenin signaling acts as a switch to induce epithelial to mesenchymal transition and promote colorectal cancer. However, due to its essential role in gut homeostasis, therapeutic targeting of this pathway has proven challenging. Additionally, IL-6/Stat-3 signaling, activated by microbial translocation through the dysregulated mucosal barrier in colon adenomas, facilitates the adenoma to adenocarcinomas transition. However, inter-dependence between these signaling pathways and key mucosal barrier components in regulating colon tumorigenesis and cancer progression remains unclear. In current study, we have discovered, using a comprehensive investigative regimen, a novel and tissue-specific role of claudin-3, a tight junction integral protein, in inhibiting colon cancer progression by serving as the common rheostat of Stat-3 and Wnt-signaling activation. Loss of claudin-3 also predicted poor patient survival. These findings however contrasted an upregulated claudin-3 expression in other cancer types and implicated role of the epigenetic regulation. Claudin-3−/− mice revealed dedifferentiated and leaky colonic epithelium, and developed invasive adenocarcinoma when subjected to colon cancer. Wnt-signaling hyperactivation, albeit in GSK-3β independent manner, differentiated colon cancer in claudin-3−/− mice versus WT-mice. Claudin-3 loss also upregulated the gp130/IL6/Stat3 signaling in colonic epithelium potentially assisted by infiltrating immune components. Genetic and pharmacological studies confirmed that claudin-3 loss induces Wnt/β-catenin activation, which is further exacerbated by Stat-3-activation and help promote colon cancer. Overall, these novel findings identify claudin-3 as a therapeutic target for inhibiting overactivation of Wnt-signaling to prevent CRC malignancy.