In this paper, we present evidence that the red ginseng powder from Panax ginseng C.A. Meyer inhibits the recurrence of AJCC stage III gastric cancer and shows immunomodulatory activities during postoperative chemotherapy, after a curative resection with D2 lymph node dissection. Flow cytometric analyses for peripheral T-lymphocyte subsets showed that the red ginseng powder restored CD4 levels to the initial preoperative values during postoperative chemotherapy. Depression of CD3 during postoperative chemotherapy was also inhibited by the red ginseng powder ingestion. This study demonstrated a five-year disease free survival and overall survival rate that was significantly higher in patients taking the red ginseng powder during postoperative chemotherapy versus control (68.2% versus 33.3%, 76.4% versus 38.5%, respectively, p < 0.05). In spite of the limitation of a small number of patients (n = 42), these findings suggest that red ginseng powder may help to improve postoperative survival in these patients. Additionally, red ginseng powder may have some immunomodulatory properties associated with CD3 and CD4 activity in patients with advanced gastric cancer during postoperative chemotherapy.