In addition to its canonical role in nuclear transcription, signal transducer and activator of transcription 3 (STAT3) is emerging as an important regulator of mitochondrial function. Here, we demonstrate that a novel inhibitor that binds with high affinity to the STAT3 SH2 domain triggers a complex cascade of events initiated by interference with mitochondrial STAT3 (mSTAT3). The mSTAT3–drug interaction leads to mitochondrial dysfunction, accumulation of proteotoxic STAT3 aggregates, and cell death. The cytotoxic effects depend directly on the drug’s ability to interfere with mSTAT3 and mitochondrial function, as demonstrated by site-directed mutagenesis and use of STAT3 knockout and mitochondria-depleted cells. Importantly, the lethal consequences of mSTAT3 inhibition are enhanced by glucose starvation and by increased reliance of cancer cells and tumor-initiating cells on mitochondria, resulting in potent activity in cell cultures and tumor xenografts in mice. These findings can be exploited for eliciting synthetic lethality in metabolically stressed cancer cells using high-affinity STAT3 inhibitors. Thus, this study provides insights on the role of mSTAT3 in cancer cells and a conceptual framework for developing more effective cancer therapies.