Peroxisome proliferator-activated receptor-gamma (PPARgamma) is expressed at very high levels in the gastrointestinal epithelium. Many of the functions of PPARgamma in gastrointestinal epithelial cells have been elucidated in recent years, and a pattern is emerging which suggests that this receptor plays an important role in gastrointestinal physiology. There is also strong evidence that PPARgamma is a colon cancer suppressor in pre-clinical rodent models of sporadic colon cancer, and there is considerable interest in exploitation of PPARgamma agonists as prophylactic or chemopreventive agents in colon cancer. Studies in mice and in human colon cancer cell lines suggest several mechanisms that might account for the tumor suppressive effects of PPARgamma agonists, although it is not in all cases clear whether these effects are altogether mediated by PPARgamma. Conversely, several reports suggest that PPARgamma agonists may promote colon cancer under certain circumstances. This possibility warrants considerable attention since several million individuals with type II diabetes are currently taking PPARgamma agonists. This review will focus on recent data related to four critical questions: what is the physiological function of PPARgamma in gastrointestinal epithelial cells; how does PPARgamma suppress colon carcinogenesis; is PPARgamma a tumor promoter; and what is the future of PPARgamma in colon cancer prevention?