Objective: We aimed to investigate the biological significance of signal transducers and activators of transcription 3 (STAT3) in gastric carcinoma. Methods: Immunohistochemistry was performed on tissue array slides containing 285 gastric carcinoma specimens. The relationship between the nuclear expression of phospho-Tyr705-STAT3 (pSTAT3), an active form of STAT3, and prognosis, clinicopathological factors, proliferation, cell cycle regulators, apoptosis regulators, or angiogenesis-related proteins was evaluated. Results: In nonneoplastic gastric mucosa, pSTAT3 was observed primarily in the nuclei of cells in the proliferative zone and intestinal metaplasia. In gastric carcinomas, nuclear STAT3 activation was observed in 36% of cases and was positively correlated with the Ki-67 labeling index and earlier tumor stage, whereas it was inversely correlated with lymphatic metastasis and distant metastasis (p< 0.05). Moreover, survival analyses showed that pSTAT3 expression was an independent prognostic factor of good survival. In addition, the expression of nuclear pSTAT3 positively correlated with that of cyclin D1, p21, p27, hypoxia-inducible factor-1α, or vascular endothelial growth factor (p< 0.05). Conclusions: STAT3 activation is an early event in gastric tumorigenesis and significantly correlates with better prognosis, proliferation and angiogenesis. Thus, STAT3 activation may be a valuable prognostic variable and therapeutic target in gastric carcinoma.