NK cells are innate lymphocytes critical for surveillance of viruses and tumors, however the mechanisms underlying NK cell dysfunction in cancer are incompletely understood. We assessed the effector function of NK cells from bladder cancer patients and found severe dysfunction in NK cells derived from tumors versus peripheral blood. While both peripheral and tumor-infiltrating NK cells exhibited conserved patterns of inhibitory receptor over-expression, this did not explain the observed defects in NK surveillance in bladder tumors. Rather, TME-specific TGF-β and metabolic perturbations such as hypoxia directly suppressed NK cell function. Specifically, an oxygen-dependent reduction in signaling through SLAMF6 was mechanistically responsible for poor NK cell function, as tumor-infiltrating NK cells cultured ex vivo under normoxic conditions exhibited complete restoration of function, while deletion of SLAMF6 abrogated NK cell cytolytic function even under normoxic conditions. Collectively, this work highlights the role of tissue-specific factors in dictating NK cell function, and implicates SLAMF6 signaling as a rational target for immuno-modulation to improve NK cell function in bladder cancer.