Inclusion Criteria:

1. ECOG status of 0 or 1.

2. Patients must be greater than or equal to 18 years of age.

3. All patients must have histologically confirmed adenocarcinoma of the rectum with
pathologic material reviewed by the Department of Pathology at MDACC. The clinical
stage must be T3, T4, or recurrent based on CT, MRI or EUS criteria.

4. All patients must have no distant metastatic disease on abdominopelvic CT scan
performed with IV contrast. If the CT was performed outside of MDACC, the slice
thickness is 7.5 mm. Criteria for pathologic enlargement of lymph nodes is > 15 mm on
short axis dimension. If CT findings of lung, liver, or peritoneal metastases are
equivocal, patients are eligible to participate.

5. The rectal tumor must be either palpable on digital rectal exam or the inferior edge
of the tumor must be within 12 cm of the anal verge based on rigid proctoscopy.

6. Patients must have WBC > 4000 cells/mm3, ANC of >1500/L, platelets > 100,000/mm3,
total serum bilirubin < 2.0 mg%, BUN < 30 mg%, creatinine < 1.5 mg% and/or creatinine
clearance >30ml/min (estimated as calculated with Cockcroft-Gault equation). Note: In
patients with moderate renal impairment (estimated creatinine clearance 30-50 mL/min)
at baseline, a dose reduction to 75% of the capecitabine starting dose is
recommended.

7. Hemoglobin of >9 gm/dL (may be transfused or receive Procrit to maintain or exceed
this level)

8. Patients must have signed informed consent indicating that they are aware of the
investigational nature of the study, and are aware that participation is voluntary.

Exclusion Criteria:

1. Known compromised renal or hepatic function.

2. Participation in any other experimental drug study.

3. AST or ALT >5 times upper limit of normal for subjects with documented liver
metastases; >2.5 times the upper limit of normal for subjects without evidence of
liver metastases.

4. Pregnant or lactating woman. Woman of childbearing potential with either a positive
or no pregnancy test at baseline. Woman / men of childbearing potential not using a
reliable contraceptive method. (Postmenopausal woman must have been amenorrheic for
at least 12 months to be considered of non-childbearing potential). Patients must
agree to continue contraception for 30 days from the date of the last study drug
administration.

5. Any prior chemotherapy.

6. Any prior radiation therapy.

7. Serious, uncontrolled, concurrent infection(s) requiring IV antibiotics.

8. Treatment for other carcinomas within the last five years, except cure non-melanoma
skin cancer and treated in-situ cervical cancer.

9. Clinically significant cardiac disease (e.g., uncontrolled hypertension [blood
pressure of >160/110 mmHg on medication], any history of myocardial infarction,
unstable angina), New York Heart Association (NYHA) Grade II or greater congestive
heart failure (see Appendix H), unstable symptomatic arrhythmia requiring medication
(subjects with chronic atrial arrhythmia, i.e., atrial fibrillation or paroxysmal
supraventricular tachycardia are eligible), or grade II or greater peripheral
vascular disease(see Appendix H).

10. Inability to to swallow oral medication.

11. Evidence of bleeding diathesis or coagulopathy, INR greater than or equal to 1.5.

12. Major surgical procedure, open biopsy, or significant traumatic injury within 28 days
prior to Day 0, or anticipation of need for major surgical procedure during the
course of the study; fine needle aspirations or core biopsies within 7 days prior to
Day 0.

13. Proteinuria at baseline or clinically significant impairment of renal function
Subjects unexpectedly discovered to have 1+ proteinuria at baseline should undergo a
24-hour urine collection, which must be an adequate collection and must demonstrate
<500 mg of protein/24 hr to allow participation in the study (see appendix F).

14. Currently has serious, nonhealing wound, ulcer, or bone fracture.

15. Had aneurysms, strokes, transient ischemic attacks, and arteriovenous malformations
within the past year.

16. Patients who have had an organ allograft.

17. Patients on Coumadin must be changed to Lovenox at least 1 week prior to starting
capecitabine. Low dose (1 mg) Coumadin is allowed.

18. Patients taking Sorivudine or Brivudine A must be off of these drugs for 4 weeks.
Patients taking cimetidine must have this drug discontinued. Ranitidine or a drug
from another anti-ulcer class can be substituted for cimetidine if necessary. If
patient is currently receiving allopurinol, must discuss with PI to see of another
agent may substitute for it.