Signal transducers and activators of transcription 3 (STAT3) was originally identified as a transcription factor that mediates cytokine-induced responses. In these pathways, Janus-activated kinase (JAK)-induced transient tyrosine phosphorylation of STAT3 promotes gene expression in response to a number of cytokines, which is inhibited by feedback mechanisms. A number of studies have shown that STAT3 is constitutively activated in human cancer cells, leading to cell proliferation. It is unclear, apart from a chronic tyrosyl phosphorylation of STAT3, what mechanisms contribute to the STAT3 deregulation in tumors. Earlier, we have isolated a novel growth inhibitory gene product, gene associated with retinoid-IFN-induced mortality 19 (GRIM-19), using a genetic approach. GRIM-19 is an IFN/retinoic acid-regulated growth suppressor. Subsequent analyses have shown that GRIM-19 binds to STAT3 and prevents interleukin-6-induced transcription of cellular genes. However, its effects on a constitutively active STAT3 and cellular transformation are unknown. In this study, we show that GRIM-19 suppresses constitutive STAT3-induced cellular transformation in vitro and in vivo by down-regulating the expression of a number of cellular genes involved in cell proliferation and apoptosis.