Genetic evidence suggests that caveolin-1, an essential component of membrane caveolae, acts as a tumor promoter in some, and a tumor suppressor in other cancers. The role of caveolin-1 in colon carcinogenesis is controversial. We report here, for the first time, that caveolin-1 is transcriptionally induced in colon cancer cells in response to conditional expression of a full length adenomatous polyposis coli (APC) gene. This induction of caveolin-1 by APC is mediated by both FOXO1a, a member of the Forkhead family of transcription factor, and c-myc. The FOXO1a protein, which is increased by wild-type APC expression, induces caveolin-1 promoter-reporter activity and binds directly to a FKHR consensus binding sequence in the caveolin-1 promoter. The c-myc protein, which is reduced in the presence of wild-type APC, acts to repress caveolin-1 expression by acting at non-E-box containing elements in the caveolin-1 promoter. These data predict that caveolin-1 protein expression would be decreased early in colonic carcinogenesis, which is associated with loss of wild-type APC. Our results would be consistent with the interpretation that caveolin-1 may have tumor suppressing functions during early stages of colon carcinogenesis.