Cancer cells exhibit properties of cells in a less differentiated state than the adjacent normal cells in the tissue. We explored whether cancer cells can be converted to a differentiated normal-like state by restoring the gene regulatory network (GRN) of normal cells. Here, we report that colorectal cancer cells exhibit a range of developmental states from embryonic and intestinal stem-like cells to differentiated normal-like cells. To identify the transcription factors (TF) that commit stem-like colorectal cancer cells into a differentiated normal-like state, we reconstructed GRNs of normal colon mucosa and identified core TFs (CDX2, ELF3, HNF4G, PPARG, and VDR) that govern the cellular state. We further found that SET Domain Bifurcated 1 (SETDB1), a histone H3 lysine 9-specific methyltransferase, hinders the function of the identified TFs. SETDB1 depletion effectively converts stem-like colorectal cancer cells into postmitotic cells and restores normal morphology in patient-derived colorectal cancer organoids.RNA-sequencing analyses revealed that SETDB1 depletion recapitulates global gene expression profiles of normal differentiated cells by restoring the transcriptional activity of core TFs on their target genes.