Understanding the mechanisms by which solid tumors suppress anti-tumor immunity is critical for success of immune therapies. Refractoriness of solid tumors including colorectal cancers (CRC) to immunotherapies is attributed to the immunosuppressive tumor microenvironment that protects malignant cells from cytotoxic T lymphocytes (CTL). We found that downregulation of the type I interferon receptor chain IFNAR1 occurs in human CRC and mouse models of CRC. Tumor microenvironment factors-induced downregulation of type I interferon receptor IFNAR1 appears to function as a central mechanism underlying the ability of tumor microenvironment to undermine viability of cytotoxic T cells and to generate intra-tumoral immune privileged niches devoid of these cells. Means preventing the loss of IFNAR1 eliminated these niches and inhibit tumor growth. Downregulation of IFNAR1 in tumor stroma stimulated CRC development and growth, played a key role in formation of the immune privileged niche and predicted poor prognosis in human CRC patients. Genetic stabilization of IFNAR1 improved CTL survival and increased the efficacy of the chimeric antigen receptor T (CART) cell transfer and PD-1 inhibition. Likewise, pharmacologic stabilization of IFNAR1 suppressed tumor growth. These findings delineate a mechanism of localized intra-tumoral immune suppression and prompt the development of IFNAR1-stabilizing agents for their use in anti-cancer immune therapies.