Conjugated linoleic acid (CLA) exerts a protective effect on experimental inflammatory bowel disease and shows promise as a chemopreventive agent against colorectal cancer (CRC) in mice, although the mechanisms by which it exerts its beneficial effects against malignancies in the gut are not completely understood. Mice lacking PPARgamma in immune and epithelial cells and PPARgamma-expressing littermates were fed either control or CLA-supplemented (1 g CLA/100 g) diets to determine the role of PPARgamma in inflammation-induced CRC. To induce tumor formation and colitis, mice were treated with azoxymethane and then challenged with 2% dextran sodium sulfate, respectively. Dietary CLA ameliorated disease activity, decreased colitis, and prevented adenocarcinoma formation in the PPARgamma-expressing floxed mice but not in the tissue-specific PPARgamma-null mice. Dietary CLA supplementation significantly decreased the percentages of macrophages in the mesenteric lymph nodes (MLN) regardless of the genotype and increased regulatory T cell numbers in MLN of PPARgamma-expressing, but not in the tissue-specific, PPARgamma-null mice. Colonic tumor necrosis factor-alpha mRNA expression was significantly suppressed in CLA-fed, PPARgamma-expressing mice. This study suggests CLA ameliorates colitis and prevents tumor formation in part through a PPARgamma-dependent mechanism.