Background Aquaporin-3 (AQP3) is a water transporting protein which plays an oncogenic role in several malignant tumors. However, its regulatory mechanism remains elusive to date. In this study, we investigated the microRNA-mediated gene repression mechanism involved in AQP3's role. Methods The potential microRNAs targeting AQP3 were searched via bioinformatic methods and identified by luciferase reporter assays, microRNA RT–PCR and western blotting. The expression patterns of miR-874 and AQP3 in human gastric cancer (GC) specimens and cell lines were determined by microRNA RT-PCR and western blotting. 5-ethynyl-2′-deoxyuridine, cell migration and invasion assays and tumorigenicity in vivo were adopted to observe the effects of miR-874 depletion or ectopic miR-874 expression on GC cell phenotypes. Cell apoptosis was evaluated by FACS and TUNEL in vitro and in vivo respectively. Results miR-874 suppressed AQP3 expression by binding to the 3′UTR of AQP3 mRNA in GC cells. miR-874 was significantly down-regulated and reversely correlated with AQP3 protein levels in clinical samples. Analysis of the clinicopathological significance showed that miR-874 and AQP3 were closely correlated with GC characteristics. Functional analyses indicated that ectopic miR-874 expression suppressed the growth, migration, invasion and tumorigenicity of GC cells, whereas miR-874 knockdown promoted these phenotypes. Down-regulation of Bcl-2, MT1-MMP, MMP-2 and MMP-9 and upregulation of caspase-3 activity and Bax were involved in miR-874 inducing cell apoptosis, and inhibiting migration and invasion. Conclusions These results provide a mechanism by which AQP3 is upregulated, as well as highlight the importance of miR-874 in gastric cancer development and progression.