We resolve an open question about the origin of the giant enhancement in the high-harmonic generation spectrum of atomic xenon around 100 eV. By solving the many-body time-dependent Schrödinger equation with all 4d, 5s, and 5p orbitals active, we truly demonstrate the enhancement results from the collective many-body excitation induced by the returning photoelectron via two-body interchannel interactions. Without the many-body interactions, which promote a 4d electron into the 5p vacancy created by strong-field ionization, no collective excitation and no enhancement in the high-harmonic generation spectrum exist.