Although the scientific and clinical rationale for classifying colorectal cancer according to mechanisms underlying genetic instability is well supported, little is known of the early morphogenesis of sporadic cancer showing high levels of DNA microsatellite instability (MSI-H). Evidence is accumulating that the traditional adenoma-carcinoma sequence may not apply to sporadic MSI-H colorectal cancer. The serrated pathway comprising hyperplastic polyps, mixed polyps and serrated adenomas may serve as the missing link. This review relates the recently described CpG island methylator phenotype (CIMP) to the serrated pathway. Two rate-limiting genetic steps may underlie the neoplastic pathway associated with CIMP. A transmembrane receptor expressed by pericryptal myofibroblasts (HPP1) may be implicated in the transition from normal to hyperplasia whereas inactivation of hMLH1 is responsible for the conversion of hyperplasia to dysplasia through loss of DNA mismatch repair. These mechanisms fit with clinical observations relating to sporadic MSI-H colorectal cancer, specifically proximal location, multiplicity, higher frequency among females and rapid evolution of early cancer.