Abstract Background Although some of the regulatory genes, signaling pathways, and gene regulatory networks altered in medulloblastomas (MB) are known, the roles of non-coding RNAs, particularly long non-coding RNAs (lncRNAs), are poorly described. Here we report that the lncRNA SPRIGHTLY (SPRY4-IT1) gene is upregulated in group 4 medulloblastoma (G4 MB). Methods SPRIGHTLY expression was assessed in MB subgroup patient-derived xenografts, cell lines, and patient samples. The effect of SPRIGHTLY hemizygous deletion on proliferation, invasion, apoptosis, and colony formation were assessed in vitro and on tumor growth in vivo. dChIRP pull-down assays were used to assess SPRIGHTLY-binding partners, confirmed by immunoprecipitation. SMYD3 ΔE5 transcripts were examined in cell lines and publicly available RNA-seq data. Pathway analysis was performed by phospho-kinase profiling and RNA-seq. Results CRISPR/Cas9 deletion of SPRIGHTLY reduced cell viability and invasion and increased apoptosis in G4 MB cell lines in vitro. SPRIGHTLY hemizygous-deleted G4 MB cells injected into mouse cerebellums produced smaller tumors than those derived from parental cells expressing both copies of SPRIGHTLY. SPRIGHTLY lncRNA bound to the intronic region of the SMYD3 pre-mRNA transcript. SPRIGHTLY also interacted with PTPB1 protein to regulate SMYD3 exon skipping to produce an aberrant protein. SPRIGHTLY-driven SMYD3 regulation enhanced the expression of EGFR pathway genes in G4 MB cell lines and activated cell coagulation/hemostasis-related gene expression, suggesting a novel oncogenic role in G4 MB. Conclusions These results demonstrate the importance of SPRIGHTLY lncRNA as a promoter of G4 MB and the role of the SPRIGHTLY-SMYD3-PTPB1 axis as an important oncogenic regulator in MB.