Activation of the transcription factor signal transducer and activator of transcription 3 (STAT3) is tightly regulated during various physiological processes, such as cell proliferation, survival, and differentiation, and aberrant STAT3 activation results in tumorigenesis. In this study, we identified the cancer/testis antigen PASD1 as a positive regulator of STAT3 activity. Overexpression of PASD1 activated STAT3 and potentiated IL-6-induced activation of STAT3, whereas knockdown of PASD1 had opposite effects. Endogenous coimmunoprecipitation experiments indicated that PASD1 interacted with STAT3 in the nucleus. Overexpression of PASD1 enhanced both basal and IL-6-induced STAT3 phosphorylation at Y705, whereas knockdown of PASD1 had opposite effects. Mechanistically, PASD1 competed with TC45, a nuclear protein tyrosine phosphatase, to associate with STAT3, thus inhibited TC45-mediated dephosphorylation of STAT3. Consistently, knockdown of PASD1 inhibited expression of many pro-oncogenic genes, leading to suppression of cell proliferation, anchorage-independent growth, cell migration, and tumor growth in nude mice. Our findings demonstrate that PASD1 serves as a critical nuclear positive regulator of STAT3-mediated gene expression and tumorigenesis.