Current evidence indicates that long noncoding RNAs (lncRNAs) play pivotal roles in human cancers. The present study aims to assess differentially expressed lncRNAs related to diffuse-type gastric carcinoma (DGC). Next-generation RNA sequencing was carried out to detect aberrantly expressed lncRNAs in DGC. Real-time polymerase chain reaction (RT-PCR) was performed to evaluate RP11–357H14.17 gene expression levels in DGC cell lines/tissues comparatively with normal gastric epithelial cell lines and adjacent normal tissues. The associations of RP11–357H14.17 expression levels with the clinicopathological features were also analyzed. The regulatory effects of RP11–357H14.17 on the biological behaviors of DGC cells were evaluated by MTT, colony formation assays, flow cytometry for apoptosis, wound healing assay, and transwell migration and invasion assays. RP11–357H14.17 expression was remarkably increased in DGC tissues and cell lines compared with normal gastric epithelial cells and adjacent normal tissues. High levels of RP11–357H14.17 were associated with increased tumor size, deeper depth of invasion, lymphatic metastasis, and advanced pathological stage. Further experiments demonstrated that the DGC cells MGC-803 transfected with si-RP11–357H14.17 showed reduced cell proliferation, migration, invasion, enhanced G1 phase arrest and cell apoptosis. These findings suggest that the novel lncRNA RP11–357H14.17 is associated with poor prognosis, and may serve as a potential prognostic biomarker and target for new antineoplastic therapies in human DGC.