Identification of molecular pathways essential for cancer stem cells is critical for understanding the underlying biology and designing effective cancer therapeutics. Here, we demonstrated that β-catenin was activated during development of MLL leukemic stem cells (LSCs). Suppression of β-catenin reversed LSCs to a pre-LSC-like stage and significantly reduced the growth of human MLL leukemic cells. Conditional deletion of β-catenin completely abolished the oncogenic potential of MLL-transformed cells. In addition, established MLL LSCs that have acquired resistance against GSK3 inhibitors could be resensitized by suppression of β-catenin expression. These results unveil previously unrecognized multifaceted functions of β-catenin in the establishment and drug-resistant properties of MLL stem cells, highlighting it as a potential therapeutic target for an important subset of AMLs.