Polyunsaturated fatty acids (PUFAs) exert immunosuppressive effects that could prove beneficial in clinical therapies for certain autoimmune and inflammatory disorders. However, the mechanism of PUFA‐mediated immunosuppression is far from understood. Here, we provide evidence that PUFAs enhance the accumulation of myeloid‐derived suppressor cells (MDSCs), a negative immune regulator. PUFA‐induced MDSCs have a more potent suppressive effect on T‐cell responses than do control MDSCs. These observations were found both in cultured mouse bone marrow cells in vitro and in vivo in mice fed diets enriched in PUFAs. The enhanced suppressive activity of MDSCs by PUFAs administration was coupled with a dramatic induction of nicotinamide adenine dinucleo‐ tide phosphate oxidase subunit p47^phox and was dependent on reactive oxygen species (ROS) production. Mechanistic studies revealed that PUFAs mediate its effects through JAK‐STAT3 signaling. Inhibition of STAT3 phosphorylation by JAK inhibitor JSI‐124 almost completely abrogated the effects of PUFAs on MDSCs. Moreover, the effects of PUFAs on MDSCs and the underlying mechanisms were confirmed in tumor‐bearing mice. In summary, this study sheds new light on the immune modulatory role of PUFAs, and demonstrates that MDSCs expansion may mediate the effects of PUFAs on the immune system.