De novo methylation of promoter region CpG islands has been increasingly associated with transcriptional inactivation of important genes in neoplasia. To study the potential mechanisms underlying aberrant methylation in cancer, we have determined the methylation patterns of selected genes in colorectal cancers with and without microsatellite instability (MI), which results from defects in one of several base mismatch repair genes. A total of 47 colorectal cancers were analyzed, of which 15 were MI+ (32%). We now report that both the frequency and the extent of de novo methylation are strikingly increased in MI+ cancers. Hypermethylation of the p16 gene was found in 60% of MI+ cancers, compared to only 22% in MI- cancers (P = 0.02). Similarly, hypermethylation of the thrombospondin-1 (TSP-1) gene, an angiogenesis inhibitor, was increased in MI+ cancers (27% versus 0%; P = 0.008). Extensive methylation of insulin-like growth factor II (IGF2) and hypermethylated in cancer-1 (HIC-1) genes was observed in 60 and 80% of MI+ cancers, respectively, as contrasted with 6 and 38% of MI- cancers (P = 0.0002 and 0.01, respectively). Furthermore, 60% of the MI+ cancers displayed the hypermethylation events at two or more loci in a concordant manner compared to only 9% of the MI- cancers (P < 0.001). These results demonstrate a strong link between promoter hypermethylation and genetic instability due to deficient DNA repair.