Tumor progression has been linked to changes in the stromal environment. Myofibroblasts are stromal cells that are often increased in tumors but their contribution to cancer progression is not well understood. Here, we show that the secretomes of myofibroblasts derived from gastric cancers [cancer-associated myofibroblasts (CAMs)] differ in a functionally significant manner from those derived from adjacent tissue [adjacent tissue myofibroblasts (ATMs)]. CAMs showed increased rates of migration and proliferation compared with ATMs or normal tissue myofibroblasts (NTMs). Moreover, conditioned medium (CM) from CAMs significantly stimulated migration, invasion and proliferation of gastric cancer cells compared with CM from ATMs or NTMs. Proteomic analysis of myofibroblast secretomes revealed decreased abundance of the extracellular matrix (ECM) adaptor protein like transforming growth factor-β-induced gene-h3 (TGFβig-h3) in CAMs, which was correlated with lymph node involvement and shorter survival. TGFβig-h3 inhibited IGF-II-stimulated migration and proliferation of both cancer cells and myofibroblasts, and suppressed IGF-II activation of p42/44 MAPkinase; TGFβig-h3 knockdown increased IGF-II- and CM-stimulated migration. Furthermore, administration of TGFβig-h3 inhibited myofibroblast-stimulated growth of gastric cancer xenografts. We conclude that stromal cells exert inhibitory as well as stimulatory effects on tumor cells; TGFβig-h3 is a stromal inhibitory factor that is decreased with progression of gastric cancers.