Abnormal regulation of β-catenin initiates an oncogenic program that serves as a main driver of many cancers. Albeit challenging, β-catenin is an attractive drug target due to its role in maintenance of cancer stem cells and potential to eliminate cancer relapse. We have identified C2, a novel β-catenin inhibitor, which is a small molecule that binds to a novel allosteric site on the surface of β-catenin. C2 selectively inhibits β-catenin, lowers its cellular load and significantly reduces viability of β-catenin-driven cancer cells. Through direct binding to β-catenin, C2 renders the target inactive that eventually activates proteasome system for its removal. Here we report a novel pharmacologic approach for selective inhibition of β-catenin via targeting a cryptic allosteric modulation site. Our findings may provide a new perspective for therapeutic targeting of β-catenin.