Abstract Background Secreted frizzled-related protein 1 (sFRP1), Wnt signalling regulator, can positively or negatively regulate tumourigenesis and progression. We sought to determine the clinical relevance and the role of sFRP1 in gastric cancer development and progression. Methods We investigated the sFRP1 protein expression levels and its clinicopathological correlations using 85 cases of human gastric samples with survival information (JWCI cohort). mRNA levels of sFRP1 and coexpressed genes were analysed using 131-sample cDNA microarray data (Ruijin cohort). The effects of sFRP1 alteration were investigated using cell proliferation, colony formation, migration, and invasion and xenograft models. Results We show that sFRP1 is overexpressed in some human cancers and is significantly associated with lymph node metastasis and decreased overall survival in gastric cancer patients. Using gastric cancer cell models, we demonstrate that sFRP1 overexpression is correlated with the activation of TGFβ (transforming growth factor-beta) signalling pathway and thereby induces cell proliferation, epithelial–mesenchymal transition (EMT), and invasion. Conversely, sFRP1 knockdown shows the opposite effects. Furthermore, sFRP1 overexpression promotes tumourigenesis and metastasis in a xenograft model. Conclusion Our studies demonstrate that sFRP1 is a biomarker for aggressive subgroups of human gastric cancer and a prognostic biomarker for patients with poor survival. Our data provide insight into a crosstalk between Wnt and TGFβ pathways which underlies gastric cancer development and progression.