Caveolin-1 (CAV1), is a broadly expressed, membrane-associated scaffolding protein that acts both, as a tumor suppressor and a promoter of metastasis, depending on the type of cancer and stage. CAV1 is downregulated in human tumors, tumor cell lines and oncogene-transformed cells. The tumor suppressor activity of CAV1 is generally associated with its presence at the plasma membrane, where it participates, together with cavins, in the formation of caveolae and also has been suggested to interact with and inhibit a wide variety of proteins through interactions mediated by the scaffolding domain. However, a pool of CAV1 is also located at the endoplasmic reticulum (ER), modulating the secretory pathway in a manner dependent on serine-80 (S80) phosphorylation. In melanoma cells, CAV1 expression suppresses tumor formation, but the protein is largely absent from the plasma membrane and does not form caveolae. Perturbations to the function of the ER are emerging as a central driver of cancer, highlighting the activation of the unfolded protein response (UPR), a central pathway involved in stress mitigation. Here we provide evidence indicating that the expression of CAV1 represses the activation of the UPR in vitro and in solid tumors, reflected in the attenuation of PERK and IRE1α signaling. These effects correlated with increased susceptibility of cells to ER stress and hypoxia. Interestingly, the tumor suppressor activity of CAV1 was abrogated by site-directed mutagenesis of S80, correlating with a reduced ability to repress the UPR. We conclude that the tumor suppression by CAV1 involves the attenuation of the UPR, and identified S80 as essential in this context. This suggests that intracellular CAV1 regulates cancer through alternative signaling outputs.