Colorectal cancers (CRCs) are a critical health issue worldwide. Cancer stem cell (CSC) lineages are associated with tumour transformation, progression, and malignant transformation. However, how lineages are transformed and how chemoresistance is acquired by CRCs remain largely unknown. In this report, we demonstrated that the RNA-binding protein Musashi-1 enhanced the development of CD44+ colorectal CSCs and triggered the formation of anti-apoptotic stress granules (SGs). Our results indicated that CD44+ CSC lineage-specific induction of tumour malignancies was controlled by Musashi-1. In addition, Musashi-1 formed SGs when CRC cell lines were treated with 5-fluorouracil. The C-terminal domain of Musashi-1 was critical for recruitment of Musashi-1 into SGs. Intracellular Musashi-1 SGs enhanced the chemoresistance of CRCs. Analysis of clinical CRC samples indicated that Musashi-1 expression was prominent in CRC stage IIA and IIB. In summary, we demonstrated that Musashi-1, a stemness gene, is a critical modulator that promotes the development of CD44+ colorectal CSCs and also enhances CRC chemoresistance via formation of SGs. Our findings elucidated a novel mechanism of CRC chemoresistance through increased anti-apoptotic effects via Musashi-1-associated SGs.