Oncogenic mutations in BRAF are believed to initiate serrated colorectal cancers; however, the mechanisms of BRAF-driven colon cancer are unclear. We find that oncogenic BRAF paradoxically suppresses stem cell renewal and instead promotes differentiation. Correspondingly, tumor formation is inefficient in BRAF-driven mouse models of colon cancer. By reducing levels of differentiation via genetic manipulation of either of two distinct differentiation-promoting factors (Smad4 or Cdx2), stem cell activity is restored in BRAFV600E intestines, and the oncogenic capacity of BRAFV600E is amplified. In human patients, we observe that reduced levels of differentiation in normal tissue is associated with increased susceptibility to serrated colon tumors. Together, these findings help resolve the conditions necessary for BRAF-driven colon cancer initiation. Additionally, our results predict that genetic and/or environmental factors that reduce tissue differentiation will increase susceptibility to serrated colon cancer. These findings offer an opportunity to identify susceptible individuals by assessing their tissue-differentiation status.