BACKGROUND: Tumor-associated fibrosis modifies the tumor microenvironment (TME), hinders the infiltration and activity of cytotoxic immune cells, and is a critical pathological process leading to the ineffectiveness of tumor immunotherapy in gastric cancer (GC). However, the specific mechanisms and interventions are yet to be fully explored. METHODS: Our study included 375 gastric cancer samples from TCGA, 1 single-cell RNA sequencing (scRNA-seq) dataset comprising of 15 gastric cancer samples from GEO, 19 cohorts of immunotherapy and 2 GWAS datasets. Consensus clustering identified a gastric cancer subtype characterized primarily by fibrosis, and various methods such as pseudotime analysis, CellChat analysis and Colocalization analysis were used to explore its mechanisms. RESULTS: A subtype of gastric cancer was identified with poor prognosis, characterized by higher malignancy, drug resistance, and poor immune infiltration, associated with elevated expression of genes related with Extracellular matrix (ECM). Single-cell transcriptome analysis showed active Collagen-CD44 signaling axis between cancer-associated fibroblasts (CAFs) and immune cells in gastric cancer, with ECM-related genes upregulated during tumor progression. The expression of CD44 was significantly elevated in the subtype, associated with poor prognosis and tumor immune suppression in gastric cancer, potentially involved in the recruitment of immunosuppressive cells such as M2 macrophages and regulatory T cells (Tregs) and the upregulation of multiple immune checkpoints including PD-1/PD-L1. CONCLUSION: Our study identified a new subtype of gastric cancer, revealing that fibrosis is a critical mechanism driving immune suppression in gastric cancer and emphasizing the central role of the Collagen-CD44 signaling axis. The Collagen-CD44 signaling axis has the potential to serve as a novel therapeutic target for gastric cancer by enhancing immune cell-mediated tumor suppression. By combining it with immune checkpoint inhibitors (ICIs), it may improve the efficacy of immunotherapy for gastric cancer and offer new hope for treatment.