COVID-19 patients readily present with severe epithelial damages such as ulceration, erosions, loss of tissue repair etc. in multiple organs. Mucosa aligning such as lung alveoli, gastrointestinal tract, oral cavity are primary targets of SARS-CoV-2 infection. The infected epithelium triggers dysregulated immune response that further damage tissues and organs. Increasing evidence suggest that the SARS-CoV-2 virus can cause direct damages on epithelial cells and fibroblasts. Here we report that the COVID-19 patient mucosa epithelium can undergo cellular dedifferentiation before any pathological features being observed. SARS-CoV-2 non-spike structural proteins, particularly the Envelope protein can rapidly induce epithelial dedifferentiation, micronuclei, cell cycle arrest to G1 phase and apoptosis. The protein can also severely affect progenitor cell stratification programme. Mechanistically, we have identified a unique molecular: Calponin 2 (CNN2) as the downstream effector of non-spike structural proteins. CNN2 was elevated in the COVID-19 patients’ epitheliums. Down regulating CNN2 could suppress epithelial cell apoptosis and restore differentiation programmes. The elevated CNN2 was under the negative control of Glis2, a transcriptional factor, which was associated with the failure of ciliary dynamics in the epithelial cells. We therefore propose a novel “double hijack” concept of how SARS-CoV-2 damages the mucosa epithelium integrity, with new therapeutic targets of COVID-19 treatment.