Emerging evidence suggests a link between tumor hypoxia and immune suppression. In this study, we investigated the role of hypoxia-induced Nanog, a stemness-associated transcription factor, in immune suppression. We observed that hypoxia-induced Nanog correlated with the acquisition of stem cell-like properties in B16-F10 cells. We further show that Nanog was selectively induced in hypoxic areas of B16-F10 tumors. Stable short hairpin RNA-mediated depletion of Nanog, combined with melanocyte differentiation Ag tyrosinase-related protein-2 peptide-based vaccination, resulted in complete inhibition of B16-F10 tumor growth. Nanog targeting significantly reduced immunosuppressive cells (regulatory T cells and macrophages) and increased CD8+ T effector cells in tumor bed in part by modulating TGF-β1 production. Additionally, Nanog regulated TGF-β1 under hypoxia by directly binding the TGF-β1 proximal promoter. Collectively, our data establish a novel functional link between hypoxia-induced Nanog and TGF-β1 regulation and point to a major role of Nanog in hypoxia-driven immunosuppression.