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Aberrant silencing of genes by DNA methylation contributes to cancer, yet how this process is initiated remains unclear. Using a murine model of inflammation-induced tumorigenesis, we tested the hypothesis that inflammation promotes recruitment of epigenetic proteins to chromatin, initiating methylation and gene silencing in tumors. Compared with normal epithelium and noninflammation-induced tumors, inflammation-induced tumors gained DNA methylation at CpG islands, some of which are associated with putative tumor suppressor genes. Hypermethylated genes exhibited enrichment of repressive chromatin marks and reduced expression prior to tumorigenesis, at a time point coinciding with peak levels of inflammation-associated DNA damage. Loss of MutS homolog 2 (MSH2), a mismatch repair (MMR) protein, abrogated early inflammation-induced epigenetic alterations and DNA hypermethylation alterations observed in inflammation-induced tumors. These results indicate that early epigenetic alterations initiated by inflammation and MMR proteins lead to gene silencing during tumorigenesis, revealing a novel mechanism of epigenetic alterations in inflammation-driven cancer. Understanding such mechanisms will inform development of pharmacotherapies to reduce carcinogenesis. Cancer Res; 77(13); 3467-78. ©2017 AACR ., (©2017 American Association for Cancer Research.)