Interleukin-25 and group 2 innate lymphoid cells (ILC2s) defend the host against intestinal helminth infection, and are associated with inappropriate allergic reactions. IL-33-activated ILC2s were previously found to augment protective tissue-specific pancreatic cancer immunity. Here, we showed that intestinal IL-25-activated ILC2s created an innate cancer-permissive microenvironment. Colorectal cancer (CRC) patients with higher tumor IL25 expression had reduced survival, and increased IL-25R-expressing tumor-resident ILC2s and myeloid-derived suppressor cells (MDSCs) associated with impaired anti-tumor responses. Ablation of IL-25-signalling reduced tumors, virtually doubling life-expectancy in an Apc-mutation-driven model of spontaneous intestinal tumorigenesis. Mechanistically, IL-25 promoted intratumoral ILC2s, which sustained tumor-infiltrating MDSCs to suppress anti-tumor immunity. Therapeutic antibody-mediated blockade of IL-25-signalling decreased intratumoral ILC2s, MDSCs and adenoma/adenocarcinoma, while increasing anti-tumor adaptive T cell and IFNγ-mediated immunity. Thus, the roles of innate epithelium-derived cytokines IL-25 and IL-33, and ILC2s in cancer cannot be generalized. The pro-tumoral nature of the IL-25-ILC2 axis in CRC highlights this pathway as a novel therapeutic target against CRC.