Receptor-related orphan receptor γ (RORγ) has emerged as an attractive therapeutic target for the treatment of cancer and inflammatory diseases. Herein, we report our effort on the discovery, optimization, and evaluation of benzothiazole and benzimidazole derivatives as novel inverse agonists of RORγ. The representative compound 27h (designated as XY123) potently inhibited the RORγ transcription activity with a half-maximal inhibitory concentration (IC50) value of 64 nM and showed excellent selectivity against other nuclear receptors. 27h also potently suppressed cell proliferation, colony formation, and the expression of androgen receptor (AR)-regulated genes in AR-positive prostate cancer cell lines. In addition, 27h demonstrated good metabolic stability and a pharmacokinetic property with reasonable oral bioavailability (32.41%) and moderate half-life (t1/2 = 4.98 h). Significantly, oral administration of compound 27h achieved complete and long-lasting tumor regression in the 22Rv1 xenograft tumor model in mice. Compound 27h may serve as a new valuable lead compound for further development of drugs for the treatment of prostate cancer.