This study aims at exploring the role of LACTB on colorectal cancer (CRC) cell differentiation. In this study, 143 colorectal cancer tissue samples were collected for analyzing the correlation between LACTB level and clinical information. Another 24 recent cases and adjacent tissues underwent qPCR, Western blot, and immunohistochemistry (IHC) to detect LACTB expression. The differentiation and proliferation of CRC cells were evaluated by AKP levels, E-cadherin expression, cell viability, colony formation, EdU assay, and cell cycle. Subcutaneous models explored LACTB's pro-differentiation effects. The glandular-like structures of tumor were observed by HE staining, immunofluorescence detection of microvilli proteins, and transmission electron microscopy. Our results showed that LACTB expression in colorectal cancer tissues was lower than that in adjacent normal tissues. Higher LACTB expression was correlated with slower tumor progression, better prognosis and higher differentiation degree. Overexpressing LACTB in CRC cells enhanced differentiation markers level (AKP and E-cadherin), while inhibited cell proliferation and colony formation, induced cell cycle arrest. Conversely, LACTB knockdown had an opposite effect. Subcutaneous xenograft tumor model suggested that LACTB overexpression inhibited tumor growth, induced tissue differentiation and glandular-like structures formation. Collectively, our results show that LACTB overexpression promotes cell differentiation and inhibits cell proliferation in CRC cells, which may serve as a therapy target for CRC.