Inclusion Criteria

DISEASE CHARACTERISTICS:

- Pathologically confirmed diagnosis of adenocarcinoma of the rectum by biopsy
technique that does not completely excise the lesion (e.g., fine needle aspiration,
core needle biopsy)

- Located up to 12 cm from the anal verge with no extension of malignant disease
into the anal canal

- Clinically determined to be stage T3 or T4,N0-N2, and M0 tumor as determined by
the following assessments:

- Colonoscopy and biopsy within 56 days prior to registration

- History/physical examination (including medication history screen for
contraindications) within 56 days prior to registration

- Contrast-enhanced imaging of the abdomen and pelvis either by CT, MRI, or
PET-CT (whole body preferred) within 56 days prior to registration

- Chest x-ray (or CT) of the chest within within 56 days prior to
registration to exclude distant metastases (except for patients who have
had whole body PET-CT)

- Transrectal ultrasound (TRUS) within 56 days prior to registration required
to establish tumor stage

- TRUS not required if clinical exam, CT of the pelvis, and/or MRI
demonstrates T4 lesion

- No synchronous primary colon carcinoma

- No evidence of distant metastases (M1)

PATIENT CHARACTERISTICS:

Inclusion criteria:

- Zubrod performance status 0-2

- ANC (absolute neutrophil count) ≥ 1,800/mm³

- Platelet count ≥ 100,000/mm³

- Hemoglobin ≥ 8.0 g/dL (transfusion or other intervention to achieve hemoglobin ≥ 8.0
g/dL allowed)

- AST (aspartate aminotransferase) < 2.5 times upper limit of normal (ULN)

- Alkaline phosphatase < 2.5 times ULN

- Bilirubin ≤ 1.5 times ULN

- Creatinine clearance > 50 mL/min

- Not pregnant or nursing

- Negative pregnancy test

- Fertile patients must use effective contraception

- No prior invasive malignancy except nonmelanoma skin cancer unless disease free for a
minimum of 3 years

Exclusion criteria:

- Severe, active comorbidity, defined as follows:

- Unstable angina and/or congestive heart failure requiring hospitalization within
the past 12 months

- Transmural myocardial infarction within the past 6 months

- Acute bacterial or fungal infection requiring intravenous antibiotics

- Chronic obstructive pulmonary disease exacerbation or other respiratory illness
requiring hospitalization or precluding study therapy within the past 30 days

- Hepatic insufficiency resulting in clinical jaundice and/or coagulation defects

- AIDS

- Evidence of uncontrolled seizures, central nervous system disorders, or
psychiatric disability judged by the investigator to be clinically significant,
precluding informed consent, or interfering with compliance of oral drug intake

- Known, existing uncontrolled coagulopathy, unless clinically stable on
anticoagulation therapy for ≥ 2 weeks

- Evidence of peripheral neuropathy ≥ grade 2

- Prior allergic reaction to oxaliplatin or capecitabine

- Lack of physical integrity of the gastrointestinal tract (i.e., severe Crohn disease
that results in malabsorption; significant bowel resection that would make one
concerned about the absorption of capecitabine) or malabsorption syndrome that would
preclude feasibility of oral chemotherapy (i.e., capecitabine)

- Prior systemic chemotherapy for colorectal cancer (prior chemotherapy allowed
provided it was for a cancer other than colorectal cancer)

- Prior radiotherapy to the region of the study cancer that would result in overlap of
radiotherapy fields

- Major surgery within 28 days of study enrollment(other than diverting colostomy
without tumor resection)

- Participation in any investigational drug study within 28 days of study enrollment.

- Concurrent cimetidine, amifostine, and/or depot Sandostatin