Cell signaling is dependent on the balance between phosphorylation of proteins by kinases and dephosphorylation by phosphatases. This balance if often disrupted in colorectal cancer (CRC), leading to increased cell proliferation and invasion. For many years research has focused on the role of kinases as potential oncogenes in cancer, while phosphatases were commonly assumed to be tumor suppressive. However, this dogma is currently changing as phosphatases have also been shown to induce cancer growth. One of these phosphatases is protein tyrosine phosphatase 1B (PTP1B). Here we report that the expression of PTP1B is increased in colorectal cancer as compared to normal tissue, and that the intrinsic enzymatic activity of the protein is also enhanced. This suggests a role for PTP1B phosphatase activity in CRC formation and progression. Furthermore, we found that increased PTP1B expression is correlated to a worse patient survival and is an independent prognostic marker for overall survival and disease free survival. Knocking down PTP1B in CRC cell lines results in a less invasive phenotype with lower adhesion, migration and proliferation capabilities. Together, these results suggest that inhibition of PTP1B activity is a promising new target in the treatment of colorectal cancer and the prevention of metastasis.