Colorectal cancer (CRC) is one of the leading causes of cancer-related death in the world. Besides genetic causes, colonic inflammation is one of the major risk factors for CRC development, which is synergistically regulated by multiple components, including innate and adaptive immune cells, cytokine signaling, and microbiota. The complex interaction between CRC and the gut microbiome has emerged as an important area of current CRC research. Metagenomic profiling has identified a number of prominent CRC-associated bacteria that are enriched in CRC patients, linking the microbiota composition to colitis and cancer development. Some microbiota species have been reported to promote colitis and CRC development in preclinical models, while a few others are identified as immune modulators to induce potent protective immunity against colitis and CRC. Mechanistically, microbiota regulates the activation of different immune cell populations, inflammation, and CRC crosstalk between innate and adaptive immune signaling pathways, including nuclear factor kappa B (NF-κB), type I interferon, and inflammasome. In this review, we provide an overview of the potential interactions between gut microbiota and host immunity and how their crosstalk could synergistically regulate inflammation and CRC, thus highlighting the potential roles and mechanisms of gut microbiota in the development of microbiota-based therapies to prevent or alleviate colitis and CRC.