Esophageal squamous cells carcinoma (ESCC) is a major common thoracic tumor characterized by distinctly high incidences and mortality rates. Despite advances in multimodality therapy, the mortality rate of ESCC remains high and understanding of molecular alterations leading to the development and progression of ESCC is still very limited. In this study, a new tumor suppressor candidate, cell adhesion molecule with homology to L1CAM (CHL1), located at 3p26 which was frequently deleted in ESCC was identified. Reduced expression of CHL1 correlated with poor differentiation, increased invasion, and lymph-node metastasis, advanced tumor stage, and decreased overall survival. Methylation-specific PCR and FISH assays revealed that down-regulation of CHL1 in both ESCC cell lines and clinical samples were associated with promoter hypermethylation and loss of heterozygosity. Functional studies using lentiviral-based overexpression and knockdown systems provided direct support of CHL1 to function as an important tumor suppressor with both anti-proliferation and anti-metastasis abilities, through Merlin and SEMA3B-Np1-mediated inhibition of AKT signaling pathway. Further characterization of CHL1 may provide a novel therapeutic target in ESCC treatment.