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NKG2D is an activating receptor expressed by all human NK cells and CD8 T cells. Harnessing the NKG2D/NKG2D ligand axis has emerged as a viable avenue for cancer immunotherapy. However, there is a long-standing controversy over whether soluble NKG2D ligands are immunosuppressive or immunostimulatory, originating from conflicting data generated from different scopes of pre-clinical investigations. Using multiple pre-clinical tumor models, we demonstrated that the impact of the most characterized human solid tumor-associated soluble NKG2D ligand, the soluble MHC I chain-related molecule (sMIC), on tumorigenesis depended on the tumor model being studied and whether the tumor cells possessed stemness-like properties. We demonstrated that the potential of tumor formation or establishment depended upon tumor cell stem-like properties irrespective of tumor cells secreting the soluble NKG2D ligand sMIC. Specifically, tumor formation was delayed or failed if sMIC-expressing tumor cells expressed low stem-cell markers; tumor formation was rapid if sMIC-expressing tumor cells expressed high stem-like cell markers. However, once tumors were formed, overexpression of sMIC unequivocally suppressed tumoral NK and CD8 T cell immunity and facilitated tumor growth. Our study distinguished the differential impacts of soluble NKG2D ligands in tumor formation and tumor progression, cleared the outstanding controversy over soluble NKG2D ligands in modulating tumor immunity, and re-enforced the viability of targeting soluble NKG2D ligands for cancer immunotherapy for established tumors.