Tumor-induced tolerance is a well-established phenomenon in cancer patients that can severely impair the therapeutic efficacy of immunotherapy. One mechanism leading to T-cell tolerance is the generation of myeloid-derived suppressor cells (MDSC) by soluble factors produced by the tumor. MDSC express CD11b⁺ as a common marker but may vary in their stage of maturation, depending on the tumor factors being produced. Arginase production by MDSC depletes arginine from the tumor microenvironment and impairs T-cell signal transduction and function. We studied whether an increase in MDSC could explain the molecular alterations and dysfunction found in T cells of patients with renal cell carcinoma (RCC). Arginase activity in the peripheral blood mononuclear cells of 117 RCC patients was increased between 6- to 8-fold compared with normal controls. The increased arginase activity was limited to the CD11b⁺CD14⁻ myeloid cells and resulted in significantly decreased serum levels of arginine and increased ornithine in patients. Depletion of MDSC restored IFN-γ production and T-cell proliferation. Preliminary data suggest that prostaglandin E₂ produced by the tumor induces arginase I expression in MDSC. Therefore, blocking MDSC activity may enhance the therapeutic efficacy of immunotherapy in RCC.