Cancer relapse after chemotherapy remains a main cause of cancer-related death. Although the relapse is thought to result from the propagation of resident cancer stem cells1, a lack of experimental platforms that enable the prospective analysis of cancer stem cell dynamics with sufficient spatiotemporal resolution has hindered the testing of this hypothesis. Here we develop a live genetic lineage-tracing system that allows the longitudinal tracking of individual cells in xenotransplanted human colorectal cancer organoids, and identify LGR5+ cancer stem cells that exhibit a dormant behaviour in a chemo-naive state. Dormant LGR5+ cells are marked by the expression of p27, and intravital imaging provides direct evidence of the persistence of LGR5+p27+ cells during chemotherapy, followed by clonal expansion. Transcriptome analysis reveals that COL17A1-a cell-adhesion molecule that strengthens hemidesmosomes-is upregulated in dormant LGR5+p27+ cells. Organoids in which COL17A1 is knocked out lose the dormant LGR5+p27+ subpopulation and become sensitive to chemotherapy, which suggests that the cell-matrix interface has a role in the maintenance of dormancy. Chemotherapy disrupts COL17A1 and breaks the dormancy in LGR5+p27+ cells through FAK-YAP activation. Abrogation of YAP signalling prevents chemoresistant cells from exiting dormancy and delays the regrowth of tumours, highlighting the therapeutic potential of YAP inhibition in preventing cancer relapse. These results offer a viable therapeutic approach to overcome the refractoriness of human colorectal cancer to conventional chemotherapy.