Abstract Colitis-associated cancer (CAC) is a complication of inflammatory bowel disease (IBD). Binding of extracellular ATP to the purinergic receptor P2RX7 has emerged as a critical event in controlling intestinal inflammation, acting to limit elevation of proinflammatory mast cells and cytokines and promote survival of regulatory T cells (Treg) and enteric neurons. In this study, we investigated the effect of P2RX7 blockade in an established mouse model of CAC. Using genetic and pharmacologic tools, we found unexpectedly that while P2RX7 mediated inflammatory responses, it also acted at an early time to suppress CAC development. P2RX7 blockade enhanced proliferation of intestinal epithelial cells and protected them from apoptosis. The proliferative effects of P2RX7 blockade were associated with an increased production of TGFβ1 that was sufficient to stimulate the proliferation of intestinal epithelial cells. Finally, P2RX7 blockade also altered immune cell infiltration and promoted Treg accumulation within lesions of the digestive system. Taken together, our findings reveal an unexpected role for P2RX7 in preventing CAC, suggesting cautions in the use of P2RX7 inhibitors to treat IBD given the possibility of increasing risks CAC as a result. Cancer Res; 75(5); 835–45. ©2015 AACR.