Wnt signaling plays important roles in development, homeostasis, and tumorigenesis. Mutations in β-catenin that activate Wnt signaling have been found in colorectal and hepatocellular carcinomas. However, the dynamics of wild-type and mutant forms of β-catenin are not fully understood. Here, we genome-engineered fluorescently tagged alleles of endogenous β-catenin in a colorectal cancer cell line. Wild-type and oncogenic mutant alleles were tagged with different fluorescent proteins, enabling the analysis of both variants in the same cell. We analyzed the properties of both β-catenin alleles using immunoprecipitation, immunofluorescence, and fluorescence correlation spectroscopy approaches, revealing distinctly different biophysical properties. In addition, activation of Wnt signaling by treatment with a GSK3β inhibitor or a truncating APC mutation modulated the wild-type allele to mimic the properties of the mutant β-catenin allele. The one-step tagging strategy demonstrates how genome engineering can be employed for the parallel functional analysis of different genetic variants