The Wnt signaling pathway, known for regulating genes critical to normal embryonic development and tissue homeostasis, is dysregulated in many types of cancer. Previously, we identified that the anthelmintic drug niclosamide inhibited Wnt signaling by promoting internalization of Wnt receptor Frizzled 1 and degradation of Wnt signaling pathway proteins, Dishevelled 2 and β-catenin, contributing to suppression of colorectal cancer growth in vitro and in vivo. Here, we provide evidence that niclosamide-mediated inhibition of Wnt signaling is mediated through autophagosomes induced by niclosamide. Specifically, niclosamide promotes the co-localization of Frizzled 1 or β-catenin with LC3, an autophagosome marker. Niclosamide inhibition of Wnt signaling is attenuated in autophagosome-deficient ATG5−/− MEF cells or cells expressing shRNA targeting Beclin1, a critical constituent of autophagosome. Treatment with the autophagosome inhibitor 3MA blocks niclosamide-mediated Frizzled 1 degradation. The sensitivity of colorectal cancer cells to growth inhibition by niclosamide is correlated with autophagosome formation induced by niclosamide. Niclosamide inhibits mTORC1 and ULK1 activities and induces LC3B expression in niclosamide-sensitive cell lines, but not in the niclosamide-resistant cell lines tested. Interestingly, niclosamide is a less effective inhibitor of Wnt-responsive genes (β-catenin, c-Myc, and Survivin) in the niclosamide-resistant cells than in the niclosamide-sensitive cells, suggesting that deficient autophagy induction by niclosamide compromises the effect of niclosamide on Wnt signaling. Our findings provide a mechanistic understanding of the role of autophagosomes in the inhibition of Wnt signaling by niclosamide and may provide biomarkers to assist selection of patients whose tumors are likely to respond to niclosamide.