Abstract Natural killer (NK) cells play a key role in tumor immune surveillance. However, adoptive immunotherapy protocols using NK cells have shown limited clinical efficacy to date, possibly due to tumor escape mechanisms that inhibit NK cell function. In this study, we analyzed the effect of coculturing melanoma cells and NK cells on their phenotype and function. We found that melanoma cells inhibited the expression of major NK receptors that trigger their immune function, including NKp30, NKp44, and NKG2D, with consequent impairment of NK cell–mediated cytolytic activity against various melanoma cell lines. This inhibitory effect was primarily mediated by indoleamine 2,3-dioxygenase (IDO) and prostaglandin E2 (PGE2). Together, our findings suggest that immunosuppressive barriers erected by tumors greatly hamper the antitumor activity of human NK cells, thereby favoring tumor outgrowth and progression. Cancer Res; 72(6); 1407–15. ©2012 AACR.