Although tyrosine-phosphorylated or activated STAT3 (pY-STAT3) is a well-described mediator of tumorigenesis, its role in thyroid cancer has not been investigated. We observed that 63 of 110 (57%) human primary papillary thyroid carcinoma (PTC) cases expressed nuclear pY-STAT3 in tumor cells, preferentially in association with the tumor stroma. An inverse relationship between pY-STAT3 expression with tumor size and the presence of distant metastases was observed. Using human thyroid cancer-derived cell lines [harboring rearranged during transfection (RET)/PTC, v-RAF murine sarcoma viral oncogene homolog B (BRAF), or rat sarcoma virus oncogene (RAS) alterations], we determined that IL-6/gp130/JAK signaling is responsible for STAT3 activation. STAT3 knockdown by shRNA in representative thyroid cancer cell lines that express high levels of pY-STAT3 had no effect on in vitro growth. However, xenografted short hairpin STAT3 cells generated larger tumors than control cells. Similarly, STAT3 deficiency in a murine model of BRAFV600E-induced PTC led to thyroid tumors that were more proliferative and larger than those tumors expressing STAT3wt. Genome expression analysis revealed that STAT3 knockdown resulted in the down-regulation of multiple transcripts, including the tumor suppressor insulin-like growth factor binding protein 7. Furthermore, STAT3 knockdown led to an increase in glucose consumption, lactate production, and expression of Hypoxia-inducible factor 1 (HIF1α) target genes, suggesting that STAT3 is a negative regulator of aerobic glycolysis. Our studies show that, in the context of thyroid cancer, STAT3 is paradoxically a negative regulator of tumor growth. These findings suggest that targeting STAT3 in these cancers could enhance tumor size and highlight the complexities of the role of STAT3 in tumorigenesis.