Canonical Wnt signaling is mediated by a molecular "switch" that regulates the transcriptional properties of the T-cell factor (TCF) family of DNA-binding proteins. Members of the myeloid translocation gene (MTG) family of transcriptional corepressors are frequently disrupted by chromosomal translocations in acute myeloid leukemia, whereas MTG16 may be inactivated in up to 40% of breast cancer and MTG8 is a candidate cancer gene in colorectal carcinoma. Genetic studies imply that this corepressor family may function in stem cells. Given that mice lacking Myeloid Translocation Gene Related-1 (Mtgr1) fail to maintain the secretory lineage in the small intestine, we surveyed transcription factors that might recruit Mtgr1 in intestinal stem cells or progenitor cells and found that MTG family members associate specifically with TCF4. Coexpression of beta-catenin disrupted the association between these corepressors and TCF4. Furthermore, when expressed in Xenopus embryos, MTG family members inhibited axis formation and impaired the ability of beta-catenin and XLef-1 to induce axis duplication, indicating that MTG family members act downstream of beta-catenin. Moreover, we found that c-Myc, a transcriptional target of the Wnt pathway, was overexpressed in the small intestines of mice lacking Mtgr1, thus linking inactivation of Mtgr1 to the activation of a potent oncogene.