We previously demonstrated that human mesenchymal stem cells (MSCs) promote the growth of osteosarcoma in the bone microenvironment. The aim of the present study was to further determine the effect of IL-6/STAT3 signaling on the progression of osteosarcoma. First, conditioned medium from MSCs was used to stimulate the growth of osteosarcoma cells (Saos-2) in vitro. We found that STAT3 was activated and that the activation could be blocked by an IL-6-neutralizing antibody. The inhibition of STAT3 in Saos-2 cells by siRNA or AG490 decreased cell proliferation, migration and invasion, down-regulated the mRNA expression of Cyclin D, Bcl-xL and Survivin and enhanced the apoptotic response. Furthermore, a nude mouse osteosarcoma model was established by injecting luciferase-labeled Saos-2 cells into the tibia, and the effect of STAT3 on tumor growth was determined by treating the mice with AG490. In vivo bioluminescence images showed that tumor growth was dramatically reduced in the AG490 group. In addition, STAT3 inhibition decreased the lung metastasis rate and prolonged the survival of these mice. After treatment with AG490, the protein levels of IL-6, p-STAT3 and PCNA were decreased, and the level of apoptosis in the tumor was increased. Altogether, these data indicate that MSCs in the bone microenvironment might promote the progression of osteosarcoma and protect tumor cells from drug-induced apoptosis through IL-6/STAT3 signaling.