Tumor-associated macrophages (TAMs) are the major component of tumor-infiltrating leukocytes. TAMs are heterogeneous, with distinct phenotypes influenced by the microenvironment surrounding tumor tissues. Decoy receptor 3 (DcR3), a member of the TNFR superfamily, is overexpressed in tumor cells and is capable of modulating host immunity as either a neutralizing decoy receptor or an effector molecule. Upregulation of DcR3 has been observed to correlate with a poor prognosis in various cancers. However, the mechanisms underlying the DcR3-mediated tumor-promoting effect remain unclear. We previously demonstrated that DcR3 modulates macrophage activation toward an M2-like phenotype in vitro and that DcR3 downregulates MHC class II expression in TAMs via epigenetic control. To investigate whether DcR3 promotes tumor growth, CT26-DcR3 stable transfectants were established. Compared with the vector control clone, DcR3-transfectants grew faster and resulted in TAM infiltration. We further generated CD68 promoter-driven DcR3 transgenic (Tg) mice to investigate tumor growth in vivo. Compared with wildtype mice, macrophages isolated from DcR3-Tg mice displayed higher levels of IL-10, IL-1ra, Ym1, and arginase activity, whereas the expression of IL-12, TNF-α, IL-6, NO, and MHC class II was downregulated. Significantly enhanced tumor growth and spreading were observed in DcR3-Tg mice, and the enhanced tumor growth was abolished by arginase inhibitor N-ω-hydroxy-Lnorarginine and histone deacetylase inhibitor sodium valproate. These results indicated that induction of TAMs is an important mechanism for DcR3-mediated tumor progression. Our findings also suggest that targeting DcR3 might help in the development of novel treatment strategies for tumors with high DcR3 expression.