Signal transducer and activator of transcription 3 (STAT3) is an attractive cancer therapeutic target. Here we report the discovery of SD-36, a small-molecule degrader of STAT3. SD-36 potently induces the degradation of STAT3 protein in vitro and in vivo and demonstrates high selectivity over other STAT members. Induced degradation of STAT3 results in a strong suppression of its transcription network in leukemia and lymphoma cells. SD-36 inhibits the growth of a subset of acute myeloid leukemia and anaplastic large-cell lymphoma cell lines by inducing cell-cycle arrest and/or apoptosis. SD-36 achieves complete and long-lasting tumor regression in multiple xenograft mouse models at well-tolerated dose schedules. Degradation of STAT3 protein, therefore, is a promising cancer therapeutic strategy.