Myeloid-derived suppressor cells (MDSCs) play an important role in the tumor-induced immunosuppressive microenvironment and have been linked with tumor development, proliferation, and resistance to treatment. Therefore, therapies that target MDSCs, such as sanguinarine (SNG), are now being considered potential treatments for lung cancer. However, the role of SNG in regulating the immune response in lung cancer is still not clear. In view of this, we evaluated the mechanism involved in the antitumor and immunoregulatory response to SNG therapy in a Lewis lung cancer (LLC) mouse model. The tumor mass and volume in the SNG treated LLC mouse model were significantly lower when compared with the control group (p < 0.05), indicating a good response to SNG. SNG also reduced the damage to the spleen, decreased the proportion of MDSCs, and increased the production of T helper 1 (Th1), T helper 2 (Th2), cytotoxic T-lymphocyte (CTL), macrophages, dendritic cells (DC) within the spleen. However, it did not affect the proportion of T helper 17 (Th17) and regulatory T cells (Treg). SNG also down-regulated the proportion of MDSCs in vitro and promoted their apoptosis, differentiation, and maturation. SNG was found to induce the differentiation of MDSCs into macrophages and DC through the nuclear factor kappa-B (NF-κB) pathway in vitro, while it also decreased the expression of arginase-1 (Arg-1) anti-inducible nitric oxide synthase (iNOS) and reactive oxygen species (ROS) in MDSCs.SNG also reduced the inhibitory effect on the proliferation of CD8T cells. SNG may reduce the immunosuppressive state induced by lung cancer by promoting cell differentiation and by inhibiting the immunosuppressive activity of MDSCs.