Anaplastic lymphoma kinase (ALK), physiologically expressed only by certain neural cells, becomes highly oncogenic, when aberrantly expressed in nonneural tissues as a fusion protein with nucleophosphin (NPM) and other partners. The reason why NPM-ALK succeeds in transforming specifically CD4(+) T lymphocytes remains unknown. The IL-2R common γ-chain (IL-2Rγ) is shared by receptors for several cytokines that play key roles in the maturation and growth of normal CD4(+) T lymphocytes and other immune cells. We show that IL-2Rγ expression is inhibited in T-cell lymphoma cells expressing NPM-ALK kinase as a result of DNA methylation of the IL-2Rγ gene promoter. IL-2Rγ promoter methylation is induced in malignant T cells by NPM-ALK. NPM-ALK acts through STAT3, a transcription factor that binds to the IL-2Rγ gene promoter and enhances binding of DNA methyltransferases (DNMTs) to the promoter. In addition, STAT3 suppresses expression of miR-21, which selectively inhibits DNMT1 mRNA expression. Reconstitution of IL-2Rγ expression leads to loss of the NPM-ALK protein and, consequently, apoptotic cell death of the lymphoma cells. These results demonstrate that the oncogenic tyrosine kinase NPM-ALK induces epigenetic silencing of the IL-2Rγ gene and that IL-2Rγ acts as a tumor suppressor by reciprocally inhibiting expression of NPM-ALK.