To characterize mechanisms of CTL inhibition within an ocular tumor microenvironment, tumor-specific CTLs were transferred into mice with tumors developing within the anterior chamber of the eye or skin. Ocular tumors were resistant to CTL transfer therapy whereas skin tumors were sensitive. CTLs infiltrated ocular tumors at higher CTL/tumor ratios than in skin tumors and demonstrated comparable ex vivo effector function to CTLs within skin tumors indicating that ocular tumor progression was not due to decreased CTL accumulation or inhibited CTL function within the eye. CD11b(+)Gr-1(+)F4/80(-) cells predominated within ocular tumors, whereas skin tumors were primarily infiltrated by CD11b(+)Gr-1(-)F4/80(+) macrophages (Ms), suggesting that myeloid derived suppressor cells may contribute to ocular tumor growth. However, CD11b(+) myeloid cells isolated from either tumor site suppressed CTL activity in vitro via NO production. Paradoxically, the regression of skin tumors by CTL transfer therapy required NO production by intratumoral Ms indicating that NO-producing intratumoral myeloid cells did not suppress the effector phase of CTL. Upon CTL transfer, tumoricidal concentrations of NO were only produced by skin tumor-associated Ms though ocular tumor-associated Ms demonstrated comparable expression of inducible NO synthase protein suggesting that NO synthase enzymatic activity was compromised within the eye. Correspondingly, in vitro-activated Ms limited tumor growth when co-injected with tumor cells in the skin but not in the eye. In conclusion, the decreased capacity of Ms to produce NO within the ocular microenvironment limits CTL tumoricidal activity allowing ocular tumors to progress.