Colorectal carcinoma (CRC) is the second leading cause of cancer-related death in the United States in the general population (men and women combined). Epidemiologic data obtained over the last several decades shows convincing evidence for the efficacy of nonsteroidal anti-inflammatory drugs (NSAIDs) in the reduction of risk of CRC through the inhibition of cycloxygenase (COX). Recent research has also demonstrated that prostaglandin E2 (PGE2), a predominant product of COX, plays a critical role in tumorigenesis of CRCs through its guanine nucleotide-binding protein (G protein)-coupled receptors (GPCRs), EP2, and EP4. Molecular analysis of CRC and its precursor lesions have shown that mutation of Adenomatous Polyposis Coli (APC), a gene involved in the wingless type signaling pathway, is an early event during the neoplastic progression in the majority of sporadic CRCs. The fundamental questions are: why is wild type APC so important in adult colorectal tissues in preventing this tumorigenesis, and what are the mechanisms by which NSAIDs prevent colorectal tumorigenesis? We reviewed the recent literature concerning the PGE2-GPCR signaling pathway and the APC-beta-catenin (wingless type) pathway in CRC cells and propose a unifying schema regarding the tumorigenesis of CRC. Colorectal epithelia are continuously exposed to various extracellular agonists (including low levels of PGE2). The binding of these agonists to their corresponding GPCRs leads to formation of activated Galphas, which in turn activates beta-catenin. In normal colorectal epithelia, wild type APC blocks the Galphas-induced activation of beta-catenin, and therefore maintains homeostasis and prevents tumorigenesis. In contrast, in the absence of functional APC, continuous formation of activated Galphas by the binding of various extracellular agonists to their receptors leads to the activation and nuclear accumulation of beta-catenin. This elevated nuclear beta-catenin in turn increases transcription of many genes (COX-2, C-myc, Cyclin D1, vascular endothelial growth factor, T cell factor, etc.) involved in tumorigenesis. Increased transcription of COX-2 also leads to excessive production of PGE2 that in turn forms a stimulatory loop with many biologic functions (proliferation, migration, invasion, angiogenesis, and inhibition of apoptosis), which may result in the development of CRC. Because NSAIDs inhibit COX and decrease the production of PGE2, interruption of the cycle helps prevent colorectal tumorigenesis.