In the progression from Inflammatory Bowel Disease to associated cancer, the clonal mutational landscape shifts from selection of mutations in inflammatory genes to selection of cancer-driver mutations1-4. How prevalence and expansion of either type of mutated clones could be impacted by the cellular environment in which they arise, and how this affects the neoplastic outcome of colitis is unknown. Here, we combine in vivo lineage tracing, in-silico modelling, mutational profiling and spatial transcriptomics in a mouse model of colitis-associated tumorigenesis to capture clone fates associated with chronic inflammation. We identify epithelial- and immune-enriched neighbourhoods and propose a model in which establishment of a reparative tissue environment facilitates tumours initiation by promoting the selection and expansion of pro-oncogenic clones, reducing the span of inflammation-resistant neighbourhoods containing non-oncogenic clones.