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Tumor-associated macrophages (TAMs) represent a distinct malignancy-promoting phenotype suggested to play a key role in tumor formation and metastasis. We aimed to investigate the expression of the monocyte/macrophage-restricted receptor CD163 in bladder tumor biopsies and assess the potential mechanism inducing the CD163 expression in tumor cells. A high CD163 mRNA expression (n= 87) was significantly associated with a poor 13-year overall survival (log-rank test, χ2 = 8.931;p= 0.0028). Moreover, CD163 mRNA expression was significantly increased in muscle invasive (T2–T4),p= 0.017, and aggressive (grade III/IV) cancers (p= 0.015). The expression strongly correlated with local expression of IL-6 (r= 0.72;p<0.0001) and IL-10 (r= 0.75;p<0.0001), mediators known to induce CD163 expressionin vitro. CD163 immunostaining (n= 46) confirmed the association between dense TAM infiltration and histologically advanced disease. In 39% of the biopsies, CD163 immunoreactivity was also observed in tumor cells, and CD163-expressing metastatic cells were identified in lymph node biopsies (n= 8). Bladder cancer cell lines did not express CD163; however, when cocultured with macrophages the bladder cancer cell expression of CD163 was significantly induced in an IL-6/IL-10 independent manner. In conclusion, we show a strong association between CD163 mRNA expression in bladder cancer biopsies and poor patient outcome. CD163 expression was not confined to the infiltrating TAMs, but was also expressed by a significant portion of the malignant cells in both tumors and lymph nodes. CD163 expressing tumor cells may constitute a subpopulation of tumor cells with a phenotypic shift associated with epithelial-to-mesenchymal transition (EMT) and increased metastatic activity induced by TAMs.