Lita's infamous heel turn took place on May 16, 2005, when she betrayed her on-screen husband, Kane, by helping Edge defeat him in the finals of the Gold Rush Tournament. At the time, Lita was involved in an outside the ring scandal where she had an illicit affair with Edge while she was involved with Matt Hardy, which led to Lita becoming a villainess due to the crowd reaction to her. Lita revealed in the following week that she was cheating on Kane with Edge, and she verbally bashed him in front of the jeering crowd. Her villainous role included an encounter with her former boyfriend Matt Hardy, who feuded with Edge for weeks. In a backstage segment on August 29, the evil Lita taunted Hardy by flashing her cleavage and saying that he will never touch her ever again. She later stood at ringside during a Street Fight between Hardy and Edge, all the while laughing evilly at seeing Hardy decimated.
As a villainess, Lita was on the receiving end of many venomous barbs, most of them from John Cena, who was feuding with Edge over the WWE Championship in 2006. In August of that year, Lita defeated Mickie James to win her third Women's Championship, and shortly afterwards, her feud with Trish Stratus was resurrected, due to Lita revealing that Trish was leaving WWE before Trish herself got the chance to break the news. At Unforgiven in September, Lita lost the Women's Championship to Trish, who retired as champion.
Lita won a tournament to become Women's Champion for the fourth time, and she would spend her reign tormenting and bullying Mickie James. In an attempt to outdo Trish, Lita announced that she would be leaving WWE after Survivor Series, and she planned to do so as champion, just like Trish did. However, Lita lost the title to Mickie at Survivor Series, and received a very humiliating departure at the hands of Cryme Time.