STAT3-STAT3 dimerization, which involves reciprocal binding of the STAT3-SH2 domain to phosphorylated tyrosine-705 (Y-705), is required for STAT3 nuclear translocation, DNA binding, and transcriptional regulation of downstream target genes. Here, we describe a small molecule S3I-1757 capable of disrupting STAT3-STAT3 dimerization, activation, and malignant transforming activity. Fluorescence polarization assay and molecular modeling suggest that S3I-1757 interacts with the phospho-Y-705-binding site in the SH2 domain and displaces fluorescein-labeled GpYLPQTV phosphotyrosine peptide from binding to STAT3. We generated hemagglutinin (HA)-tagged STAT3 and FLAG-tagged STAT3 and showed using coimmunoprecipitation and colocalization studies that S3I-1757 inhibits STAT3 dimerization and STAT3-EGF receptor (EGFR) binding in intact cells. Treatment of human cancer cells with S3I-1757 (but not a closely related analog, S3I-1756, which does not inhibit STAT3 dimerization), inhibits selectively the phosphorylation of STAT3 over AKT1 and ERK1/2 (MAPK3/1), nuclear accumulation of P-Y705-STAT3, STAT3-DNA binding, and transcriptional activation and suppresses the expression levels of STAT3 target genes, such as Bcl-xL (BCL2L1), survivin (BIRC5), cyclin D1 (CCND1), and matrix metalloproteinase (MMP)-9. Furthermore, S3I-1757, but not S3I-1756, inhibits anchorage-dependent and -independent growth, migration, and invasion of human cancer cells, which depend on STAT3. Finally, STAT3-C, a genetically engineered mutant of STAT3 that forms a constitutively dimerized STAT3, rescues cells from the effects of S3I-1757 inhibition. Thus, we have developed S3I-1757 as a STAT3-STAT3 dimerization inhibitor capable of blocking hyperactivated STAT3 and suppressing malignant transformation in human cancer cells that depend on STAT3.