Deregulated microRNAs and their roles in tumorigenesis have attracted much attention in recent years. Although miR-503 was shown to be important in tumorigenesis, its role in osteosarcoma remains unknown. In this study, we focused on the expression and mechanisms of miR-503 in osteosarcoma development. We found that miR-503 was down-regulated in osteosarcoma cell lines and primary tumor samples, and the restoration of miR-503 reduced cell proliferation, migration and invasion. Low level of miR-503 in patients with osteosarcoma was associated with considerably shortened disease-free survival. Furthermore, bioinformatic prediction and experimental validation revealed that the anti-tumor effect of miR-503 was probably exerted through targeting and repressing of L1CAM expression. L1CAM was up-regulated in osteosarcoma cell lines and primary tumor samples and the expression level of L1CAM were negatively correlated with miR-503 levels in osteosarcoma tissues. Collectively, our data identify the important roles of miR-503 in osteosarcoma pathogenesis, indicating its potential application in cancer therapy.