Myeloid-derived suppressor cells (MDSCs) are critical mediators of tumor-associated immune suppression, with their numbers and activity strongly increased in most human cancers and animal models. MDSCs suppress anti-tumor immunity through multiple mechanisms, including the manipulation of arginine and tryptophan metabolism by such factors as arginase (Arg), inducible nitric oxide synthase (iNOS/NOS2), and indoleamine-2,3-dioxygenase (IDO). Prostaglandin E(2) (PGE(2)), a mediator of chronic inflammation and tumor progression, has emerged as a key molecule in MDSC biology. PGE(2) promotes MDSC development and their induction by additional factors, directly suppresses T cell immune responses and participates in the induction of other MDSC-associated suppressive factors, including Arg, iNOS and IDO. It further promotes MDSC recruitment to tumor environments through the local induction of CXCL12/SDF-1 and the induction and stabilization of the CXCL12 receptor, CXCR4, on tumor-associated MDSCs. The establishment of a positive feedback loop between PGE(2) and cyclooxygenase 2 (COX-2), the key regulator of PGE(2) synthesis, stabilizes the MDSC phenotype and is required for their suppressive function. The central role of PGE(2) in MDSC biology provides for a feasible target for counteracting MDSC-mediated immune suppression in cancer.