Deregulation of microRNA (miRNA) expression can have a critical role in carcinogenesis. Here we show in prostate cancer that miRNA-205 (miR-205) transcription is commonly repressed and the MIR-205 locus is hypermethylated. LOC642587, the MIR-205 host gene of unknown function, is also concordantly inactivated. We show that miR-205 targets mediator 1 (MED1, also called TRAP220 and PPARBP) for transcriptional silencing in normal prostate cells, leading to reduction in MED1 mRNA levels, and in total and active phospho-MED1 protein. Overexpression of miR-205 in prostate cancer cells negatively affects cell viability, consistent with a tumor suppressor function. We found that hypermethylation of the MIR-205 locus was strongly related with a decrease in miR-205 expression and an increase in MED1 expression in primary tumor samples (n=14), when compared with matched normal prostate (n=7). An expanded patient cohort (tumor n=149, matched normal n=30) also showed significant MIR-205 DNA methylation in tumors compared with normal, and MIR-205 hypermethylation is significantly associated with biochemical recurrence (hazard ratio=2.005, 95% confidence interval (1.109, 3.625), P=0.02), in patients with low preoperative prostate specific antigen. In summary, these results suggest that miR-205 is an epigenetically regulated tumor suppressor that targets MED1 and may provide a potential biomarker in prostate cancer management.