Rectal cancer is a disease in which malignant (cancer) cells form in the tissues of the rectum. Health history affects the risk of developing rectal cancer. Signs of rectal cancer include a change in bowel habits or blood in the stool. Rectal cancer occurs when healthy cells in the rectum develop errors in their DNA. In most cases, the cause of these errors is unknown. Rectal cancer is cancer that develops in cells in the rectum. Your rectum and colon are both part of the digestive system, so rectal and colon cancers are often grouped under the term colorectal cancer. The rectum is located below the sigmoid colon and above the anus. The rectum and the colon make up the large intestine, or large bowel. The rectum is the last six inches of the large bowel and connects the colon to the anus. Cancer of the rectum and/or colon is referred to as colorectal cancer and is the fourth most common cancer in the United States.