Accumulating evidence indicates that the aberrant expression of long noncoding RNAs (lncRNAs) is involved in tumorigenesis and cancer development. However, the biological functions and underlying mechanisms of lncRNAs in bladder cancer (BC) remain largely unknown. Here, we analyzed the lncRNA and mRNA expression profiles in BC using a microarray assay. We found that lncRNA RP11-79H23.3 and phosphatase and tensin homolog (PTEN) were significantly downregulated in BC tissues and cells. Meanwhile, RP11-79H23.3 expression was negatively correlated with clinical stage in BC. Functionally, we found that overexpression of RP11-79H23.3 could suppress cell proliferation, migration, and cell cycle progression, rearrange the cytoskeleton, and induce apoptosis in vitro. Moreover, upregulation of RP11-79H23.3 inhibited the angiogenesis, tumorigenesis, and lung metastasis in vivo, whereas RP11-79H23.3 knockdown exerted a contrary role. Mechanistically, we identified that RP11-79H23.3 could directly bind to miR-107 and abolish the suppressive effect on target gene PTEN, which leads to inactivation of the PI3K/Akt signaling pathway. Taken together, we first demonstrated that RP11-79H23.3 might suppress the pathogenesis and development of BC by acting as a sponge for miR-107 to increase PTEN expression. Our research revealed that RP11-79H23.3 could be a potential target for diagnosis and therapy of BC.