Tumors have evolved numerous mechanisms by which they can escape from immune surveillance. One of these is to produce immunosuppressive cytokines. Transforming growth factor-β(TGF-β) is a pleiotropic cytokine with a crucial function in mediating immune suppression, especially in the tumor microenvironment. TGF-β produced by T cells has been demonstrated as an important factor for suppressing antitumor immune responses, but the role of tumor-derived TGF-β in this process is poorly understood. In this study, we demonstrated that knockdown of tumor-derived TGF-β using shRNA resulted in dramatically reduced tumor size, slowing tumor formation, prolonging survival rate of tumor-bearing mice and inhibiting metastasis. We revealed possible underlying mechanisms as reducing the number of myeloid-derived suppressor cells (MDSC) and CD4+Foxp3+ Treg cells, and consequently enhanced IFN-γ production by CTLs. Knockdown of tumor-derived TGF-β also significantly reduced the conversion of naïve CD4+ T cells into Treg cells in vitro. Finally, we found that knockdown of TGF-β suppressed cell migration, but did not change the proliferation and apoptosis of tumor cells in vitro. In summary, our study provided evidence that tumor-derived TGF-β is a critical factor for tumor progression and evasion of immune surveillance, and blocking tumor-derived TGF-β may serve as a potential therapeutic approach for cancer.