Entosis is a form of nonphagocytic cell-in-cell (CIC) interaction where a living cell enters into another. Tumors show evidence of entosis; however, factors controlling entosis remain to be elucidated. Here, we find that besides inducing apoptosis, TRAIL signaling is a potent activator of entosis in colon cancer cells. Initiation of both apoptosis and entosis requires TRAIL receptors DR4 and DR5; however, induction of apoptosis and entosis diverges at caspase-8 as its structural presence is sufficient for induction of entosis but not apoptosis. Although apoptosis and entosis are morphologically and biochemically distinct, knockout of Bax and Bak, or inhibition of caspases, also inhibits entotic cell death and promotes survival and release of inner cells. Analysis of colorectal cancer tumors reveals a significant association between TRAIL signaling and CIC structures. Finally, the presence of CIC structures in the invasive front regions of colorectal tumors shows a strong correlation with adverse patient prognosis.