MicroRNAs (miRNAs) are small, non-coding RNAs that regulate gene expression by targeted repression of transcription and translation. In this study we show that miRNA-23b (miR-23b) acts as a tumor suppressor in bladder cancer. Quantitative real-time PCR analysis showed that miR-23b is significantly down-regulated in bladder cancer cell lines and tumor tissues compared to non-malignant cells and normal tissue samples. We also demonstrate that miR-23b expression has a potential to be diagnostic and prognostic biomarker in bladder cancer. High miR-23b expression is positively correlated with higher overall survival of bladder cancer patients as revealed by Kaplan-Meier analysis. ROC analysis showed that miR-23b expression can distinguish between normal and bladder cancer tissues. Further we elucidated the biological significance of miR-23b in bladder cancer. Over-expression of miR-23b in bladder cancer cells inhibited cell proliferation and impaired colony formation. Fluorescence activated cell sorting (FACS) analysis revealed that re-expression of miR-23b in bladder cancer cells induced G0/G1 cell cycle arrest and apoptosis while inhibiting cell migration and invasion. Luciferase reporter assays demonstrated that Zeb1, a crucial regulator of epithelial-to-mesenchymal transition (EMT), is a direct target of miR-23b in bladder cancer. These results show that loss of miR-23b confers a proliferative advantage and promotes bladder cancer cell migration and invasion. Furthermore, re-expression of miR-23b may be a beneficial therapeutic strategy for the treatment of human bladder cancer.