Aberrant Wnt signaling can drive cancer development. In many cancer types, the genetic basis of Wnt pathway activation remains incompletely understood. Here, we report recurrent somatic mutations of the Drosophila melanogaster tumor suppressor-related gene FAT1 in glioblastoma (20.5%), colorectal cancer (7.7%), and head and neck cancer (6.7%). FAT1 encodes a cadherin-like protein, which we found is able to potently suppress cancer cell growth in vitro and in vivo by binding β-catenin and antagonizing its nuclear localization. Inactivation of FAT1 via mutation therefore promotes Wnt signaling and tumorigenesis and affects patient survival. Taken together, these data strongly point to FAT1 as a tumor suppressor gene driving loss of chromosome 4q35, a prevalent region of deletion in cancer. Loss of FAT1 function is a frequent event during oncogenesis. These findings address two outstanding issues in cancer biology: the basis of Wnt activation in non-colorectal tumors and the identity of a 4q35 tumor suppressor.