The hair follicle dermal papilla (DP) contains a unique prominin-1/CD133-positive (CD133+) cell subpopulation, which has been shown to possess hair follicle-inducing capability. By assaying for endogenous CD133 expression and performing lineage tracing using CD133-CreERT2; ZsGreen1 reporter mice, we find that CD133 is expressed in a subpopulation of DP cells during the growth phase of the murine hair cycle (anagen), but is absent at anagen onset. However, how CD133+ DP cells interact with keratinocytes to induce hair regenerative growth remains unclear. Wnt/β-catenin has long been recognized as a major signaling pathway required for hair follicle morphogenesis, development, and regeneration. Nuclear Wnt/β-catenin activity is observed in the DP during the hair growth phase. Here we show that induced expression of a stabilized form of β-catenin in CD133+ DP cells significantly accelerates spontaneous and depilation-induced hair growth. However, hair follicle regression is not affected in these mutants. Further analysis indicates that CD133+ DP-expressed β-catenin increases proliferation and differentiation of epithelial matrix keratinocytes. Upregulated Wnt/β-catenin activity in CD133+ DP cells also increases the number of proliferating DP cells in each anagen follicle. Our data demonstrate that β-catenin signaling potentiates the capability of CD133+ DP cells to promote postnatal hair growth.