It is widely accepted that intake of dietary fats and chronic inflammation are risk factors for developing colorectal cancer. Arachidonic acid is a major component of animal fats, and the bioactive lipids produced from this substrate play critical roles in a variety of biologic processes, including cancer. Cyclooxygenase-derived prostaglandin E2 is a known proinflammatory lipid mediator that promotes tumor progression. Metabolism of arachidonic acid by the cyclooxygenase pathway provides one mechanism for the contribution of dietary fats and chronic inflammation to carcinogenesis. In this review, we highlight recent advances in our understanding of how a proinflammatory mediator prostaglandin E2 promotes colorectal cancer immune evasion. These findings may provide a rationale for the development of new therapeutic approaches to subvert tumor-induced immunosuppression.