Stem cells play critical roles both in the development of cancer and therapy resistance. Although mesenchymal stem cells (MSCs) can actively migrate to tumor sites, their impact on chimeric antigen receptor modified T cell (CAR-T) immunotherapy has been little addressed. Using an in vitro cell co-culture model including lymphoma cells and macrophages, here we report that CAR-T cell-mediated cytotoxicity was significantly inhibited in the presence of MSCs. MSCs caused an increase of CD4 T cells and Treg cells but a decrease of CD8 T cells. In addition, MSCs stimulated the expression of indoleamine 2,3-dioxygenase and programmed cell death-ligand 1 which contributes to the immune-suppressive function of tumors. Moreover, MSCs suppressed key components of the NLRP3 inflammasome by modulating mitochondrial reactive oxygen species release. Interestingly, all these suppressive events hindering CAR-T efficacy could be abrogated if the stanniocalcin-1 (STC1) gene, which encodes the glycoprotein hormone STC-1, was knockdown in MSC. Using xenograft mice, we confirmed that CAR-T function could also be inhibited by MSC in vivo, and STC1 played a critical role. These data revealed a novel function of MSC and STC-1 in suppressing CAR-T efficacy, which should be considered in cancer therapy and may also have potential applications in controlling the toxicity arising from the excessive immune response.