Background: Colorectal cancer (CRC) is the third most common cancer and third leading cause of cancer-associated deaths worldwide. Diagnosing CRC patients reliably at an early and curable stage is of utmost importance to reduce the risk of mortality.Methods: We identified global differentially expressed genes with copy number alterations in patients with CRC. We then identified genes that are also expressed in blood, which resulted in a blood-based gene signature. We validated the gene signature’s diagnostic and prognostic potential using independent datasets of gene expression profiling from over 800 CRC patients with detailed clinical data. Functional enrichment, gene interaction networks and pathway analyses were also performed.Results: The analysis revealed a 17-gene signature that is expressed in blood and demonstrated that it has diagnostic potential. The 17-gene SVM classifier displayed 99 percent accuracy in predicting the patients with CRC. Moreover, we developed a prognostic model and defined a risk-score using 17-gene and validated that high risk score is strongly associated with poor disease outcome. The 17-gene signature predicted disease outcome independent of other clinical factors in the multivariate analysis (HR = 2.7, 95% CI = 1.3–5.3, p = 0.005). In addition, our gene network and pathway analyses revealed alterations in oxidative stress, STAT3, ERK/MAPK, interleukin and cytokine signaling pathways as well as potentially important hub genes, including BCL2, MS4A1, SLC7A11, AURKA, IL6R, TP53, NUPR1, DICER1, DUSP5, SMAD3, and CCND1.Conclusion: Our results revealed alterations in various genes and cancer-related pathways that may be essential for CRC transformation. Moreover, our study highlights diagnostic and prognostic value of our gene signature as well as its potential use as a blood biomarker as a non-invasive diagnostic method. Integrated analysis transcriptomic data coupled with copy number aberrations may provide a reliable method to identify key biological programs associated with CRC and lead to improved diagnosis and therapeutic options.