Ligands for peroxisome proliferator-activated receptor gamma (PPARc) possess anticancer properties. However, the efficacy of PPARc ligands varies in different cancers. In colon cancer, the role of PPARc and its ligands is controversial. We recently showed that downregulation of X-linked inhibitor of apoptosis protein (XIAP) could sensitize colon cancer cells to troglitazone, and 15-deoxy-D12,14-prostaglandin J2 (15-PGJ2) induced cell killing. In our study, we aimed to examine whether rosiglitazone, another more clinically relevant PPARc ligand, has any synergistic anticancer effect with XIAP downregulation in colon cancer. Human colon cancer cell lines HCT116-XIAP 1/1 cells and HCT116-XIAP 2/2 cells were treated with various concentrations of rosiglitazone. The effects of rosiglitazone on cell proliferation, apoptosis and growth of xenograft colon cancers were studied. Rosiglitazone barely suppressed the growth and only very weakly induced apoptosis in HCT116 cells in vitro. Loss of XIAP did not sensitize HCT116 cells to rosiglitazone-induced growth inhibition or apoptosis. In vivo studies revealed that rosiglitazone strongly suppressed the growth of xenograft colon cancer, especially tumors derived from HCT116-XIAP 2/2 cells. The rosiglitazone-treated tumor had reduced expression of ki-67 and lowered mitotic rate. Downregulation of XIAP was associated with an impaired activation of PPARc by its ligand. Rosiglitazone induced marked upregulation of PTEN in HCT116-XIAP 2/2 cells, as well as in xenograft tumors derived from HCT116-XIAP 2/2 cells. We concluded that rosiglitazone significantly suppresses the growth of xenograft colon cancer, and downregulation of XIAP sensitizes the xenograft tumors to rosiglitazone-induced tumor suppression in vivo via upregulation of PTEN.