Wnt/β-catenin signaling is an evolutionarily conserved and versatile pathway that is known to be involved in embryonic development, tissue homeostasis and a wide variety of human diseases. Aberrant activation of this pathway gives rise to the accumulation of β-catenin in the nucleus and promotes the transcription of many oncogenes such as c-Myc and CyclinD-1. As a result, it contributes to carcinogenesis and tumor progression of several cancers, including colon cancer, hepatocellular carcinoma, pancreatic cancer, lung cancer and ovarian cancer. β-Catenin is a pivotal component of the Wnt signaling pathway and it is tightly regulated at three hierarchical levels: protein stability, subcellular localization and transcriptional activity. Uncovering the regulatory mechanisms of β-catenin will provide new insights into the pathogenesis of cancer and other diseases, as well as new therapeutic strategies against these diseases. In this review we dissect the concrete regulatory mechanisms of β-catenin from three aspects mentioned above. Then we focus on the role of β-catenin in cancer initiation, progression, dormancy, immunity and cancer stem cell maintenance. At last, we summarize the recent progress in the development of agents for the pharmacological modulation of β-catenin activity in cancer therapy.