We report for the first time the use of a water-soluble, tungsten polyoxometalate H3PW12O40 (PW12-POM) as an efficient cathode interlayer incorporated into poly(3-hexylthiophene):[6,6]-phenyl-C61-butyric acid methyl ester (P3HT:PCBM-61) polymer solar cells. The short circuit photocurrent density of the PW12-POM modified device is enhanced by ∼40% the open circuit voltage increases from 0.61 V to 0.65 V and the fill factor from 0.36 to 0.41, resulting to a power conversion efficiency enhancement of ∼70% (from 1.57% for the reference to 2.7% for the PW12-POM modified device). The improvement is attributed to enhanced electron transfer/extraction at the PW12-POM/Al interface as a result of the favorable interfacial energy level alignment and possible enhancement of the local electric field due to the nanoscale morphology of the PW12-POM layer, as evidenced by AFM measurements. A reduced degradation rate was measured for PW12-POM modified devices stored in dark and measured in ambient conditions. Taking into account the advantageous solution processability of PW12-POM, the large increase in the device efficiency and the improvement of their stability, we manifest that PW12-POM has highly desirable properties in order to be embedded as cathode interlayer in organic photovoltaic cells.