Somatic mutations in p53, which inactivate the tumour-suppressor function of p53 and often confer oncogenic gain-of-function properties, are very common in cancer^,. Here we studied the effects of hotspot gain-of-function mutations in Trp53 (the gene that encodes p53 in mice) in mouse models of WNT-driven intestinal cancer caused by Csnk1a1 deletion^, or Apc^Min mutation. Cancer in these models is known to be facilitated by loss of p53^,. We found that mutant versions of p53 had contrasting effects in different segments of the gut: in the distal gut, mutant p53 had the expected oncogenic effect; however, in the proximal gut and in tumour organoids it had a pronounced tumour-suppressive effect. In the tumour-suppressive mode, mutant p53 eliminated dysplasia and tumorigenesis in Csnk1a1-deficient and Apc^Min/+ mice, and promoted normal growth and differentiation of tumour organoids derived from these mice. In these settings, mutant p53 was more effective than wild-type p53 at inhibiting tumour formation. Mechanistically, the tumour-suppressive effects of mutant p53 were driven by disruption of the WNT pathway, through preventing the binding of TCF4 to chromatin. Notably, this tumour-suppressive effect was completely abolished by the gut microbiome. Moreover, a single metabolite derived from the gut microbiota—gallic acid—could reproduce the entire effect of the microbiome. Supplementing gut-sterilized p53-mutant mice and p53-mutant organoids with gallic acid reinstated the TCF4–chromatin interaction and the hyperactivation of WNT, thus conferring a malignant phenotype to the organoids and throughout the gut. Our study demonstrates the substantial plasticity of a cancer mutation and highlights the role of the microenvironment in determining its functional outcome.