Gastric cancer is one of the leading causes of malignancy-related mortality worldwide, and drug resistance hampered the clinical efficacy of chemotherapy. To better understand the molecular mechanism causing drug resistance, we previously established an isogenic pair of doxorubicin-sensitive and -resistant gastric cancer cell lines, SGC7901 and SGC7901/ADR cells. Here, we investigated how modulation of CUTL1 activity affects the response of gastric cancer to frequently used chemotherapeutic agents. In this study, we demonstrated that CUTL1 transcription activity was significantly reduced in doxorubicin-resistant cells. Furthermore, decreased CUTL1 expression was strongly associated with intrinsic drug resistance in human gastric cancer tissues and could be used as a poor prognosis biomarker. Both gain-of-function (by overexpression of active CUTL1) and loss-of-function (by CUTL1-specific shRNA knockdown) studies showed that increased CUTL1 activity significantly enhanced cell sensitivity to drugs and led to increased apoptosis, whereas decreased CUTL1 expression dramatically reduced cell sensitivity to drugs and thus fewer apoptoses. Importantly, modulation of CUTL1 activity resulted in altered sensitivity to multiple drugs. In vivo mouse studies indicated that overexpression of active CUTL1 significantly resulted in increased cancer tissue response to chemotherapy and therefore inhibited growth, whereas knockdown of CUTL1 conferred resistance to chemotherapy. Taken together, our results strongly indicate that CUTL1 activity is inversely associated with drug resistance and thus is an attractive therapeutic target to modulate multidrug resistance in gastric cancer.