Colorectal cancer (CRC) is one of the most common type of malignancy with a poor prognosis, due to a high frequency of metastasis and tumor recurrence. It has been reported that deletion and/or mutation of the PTEN gene can be involved in the pathogenesis of many types of cancers through the activation of the PI3K/Akt signaling pathway. Immunohistochemical staining was conducted to detect PTEN expression in CRC, adenomas and normal tissues. For the measurement of cell proliferation, CCK-8 was used. Apoptotic cells were quantified using FACS. Immunohistochemical staining results demonstrated that the expression of PTEN gradually decreased from normal colorectal mucosa, to colon hyperplastic polyps, adenomas, and ultimately primary colorectal adenocarcinomas. Upregulation of PTEN expression inhibited the proliferation of LoVo and SW480 cells, inducing G1 phase arrest and reducing the number of cells in the S phase. LoVo and SW480 cells with upregulated PTEN were sensitive to apoptosis induced by 5-FU. In addition, upregulation of PTEN inhibited the activity of Akt and activated the FoxO transcription factor. This is the first report of a gradual decrease in expression of PTEN from normal colon epithelial tissue to colon hyperplastic polyps, colorectal adenomas and finally CRC. Upregulation of PTEN inhibited the activity of the Akt pathway and regulated downstream genes involved in the cell cycle. These results suggest that inhibition of CRC cell proliferation and cell cycle arrest by PTEN are closely related to PI3K/Akt/FoxO.