A growing body of evidence suggests that long non‐coding RNA (lncRNA) is aberrantly expressed in human cancer and linked to cancer initiation and development. We previously identified Homo sapiens PGM5 antisense RNA 1 (PGM5‐AS1) as a novel esophageal squamous cell carcinoma (ESCC)‐related lncRNA by performing high‐throughput RNA sequencing. However, its clinical implication and biological function in ESCC are still uncharacterized. In the present study, we found that PGM5‐AS1 was frequently downregulated in ESCC tissues, plasma, and cell lines, and low PGM5‐AS1 expression was positively correlated with poor differentiation, advanced tumor node metastasis (TNM) stage, and lymph node metastasis. Importantly, PGM5‐AS1 was identified to be an effective diagnostic and prognostic biomarker for ESCC patients. Functional experiments revealed that exogenous expression of PGM5‐AS1 significantly suppressed the proliferation, migration, and invasion of ESCC cells in vitro as well as tumor growth in vivo. Mechanistically, PGM5‐AS1 was transcriptionally activated by p53 and it could directly interact with and sequester miR‐466 to elevate PTEN expression, thereby inhibiting ESCC progression. Overall, our data indicate that PGM5‐AS1 is a novel tumor suppressor in ESCC and restoration of PGM5‐AS1 may be a promising avenue for treatment of ESCC patient.