Gene inactivation of the orphan G protein‐coupled receptor LGR4, a paralogue of the epithelial‐stem‐cell marker LGR5, results in a 50% decrease in epithelial cell proliferation and an 80% reduction in terminal differentiation of Paneth cells in postnatal mouse intestinal crypts. When cultured ex vivo, LGR4‐deficient crypts or progenitors, but not LGR5‐deficient progenitors, die rapidly with marked downregulation of stem‐cell markers and Wnt target genes, including Lgr5. Partial rescue of this phenotype is achieved by addition of LiCl to the culture medium, but not Wnt agonists. Our results identify LGR4 as a permissive factor in the Wnt pathway in the intestine and, as such, as a potential target for intestinal cancer therapy.