Updated project metadata. Tumors are complex ecosystems composed of different types of cells that communicate and influence each other. While the critical role of stromal cells in affecting tumor growth is well established, the impact of mutant cancer cells on healthy surrounding tissues remains poorly defined. Here, we uncovered a paracrine mechanism by which intestinal cancer cells reactivate fetal and regenerative Yap-associated transcriptional programs in neighboring wildtype epithelial cells, rendering them adapted to thrive in the tumor context. We identified the glycoprotein Thrombospondin-1 (Thbs1) as the essential factor that mediates non-cell autonomous morphological and transcriptional responses. Importantly, Thbs1 is associated with bad prognosis in several human cancers. This study reveals the Thbs1-YAP axis as the mechanistic link mediating paracrine interactions between epithelial cells, promoting tumor formation and progression.