The 1956–57 season was Colchester United's 15th season in their history and their seventh season in the Third Division South, the third tier of English football. Alongside competing in the Third Division South, the club also participated in the FA Cup in which the club were eliminated by Southend United in the first round in the first Essex derby in a cup competition. The season would be Colchester United's highest league finish for 50 years by ending their campaign in third position. It has only been bettered on three occasions; the 2005–06 season, 2006–07 season and the 2007–08 season.

The 1956–57 season proved to be Colchester United's best finish in their history, ending the season in third position in the third tier with a result that was not bettered until 2006. For the majority of the season, Colchester were favourites for promotion, during which time they went 20 league games unbeaten between December 1956 and Easter 1957.

Colchester and rivals Ipswich Town vied for the top spot for much of the season. Colchester were seven-points ahead of their third-placed rivals when the two sides met at Layer Road on 16 February 1957. A record crowd of 18,559 witnessed the 0–0 draw, with over 4,000 fans turned away and over 100 spectators witnessing the action from the roof of the Popular Side stand. Player-manager Benny Fenton missed a 21st-minute penalty during the match, which was saved by Ipswich goalkeeper Roy Bailey.

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