Background <p>Emerging evidence shows that small nucleolar RNA (snoRNA), a type of highly conserved non-coding RNA, is involved in tumorigenesis and aggressiveness. However, the roles of snoRNAs in regulating alternative splicing crucial for cancer progression remain elusive.</p> Methods <p>High-throughput RNA sequencing and comprehensive analysis were performed to identify crucial snoRNAs and downstream alternative splicing events. Biotin-labeled RNA pull-down, mass spectrometry, cross-linking RNA immunoprecipitation, and in vitro binding assays were applied to explore interaction of snoRNAs with protein partners. Alternative splicing and gene expression was observed by real-time quantitative RT-PCR and western blot assays. In vitro and in vivo studies were performed to investigate biological effects of snoRNAs and their protein partners in gastric cancer. Survival analysis was undertaken by using Kaplan-Meier method and log-rank test.</p> Results <p><i>SNORA37</i> was identified as an up-regulated snoRNA essential for tumorigenesis and aggressiveness of gastric cancer. Gain- and loss-of-function studies indicated that <i>SNORA37</i> promoted the growth, invasion, and metastasis of gastric cancer cells in vitro and in vivo. Mechanistically, as an ELAV like RNA binding protein 1 (ELAVL1)-generated snoRNA, <i>SNORA37</i> directly bound to cap methyltransferase 1 (CMTR1) to facilitate its interaction with ELAVL1, resulting in nuclear retention and activity of ELAVL1 in regulating alternative splicing of <i>CD44</i>. Rescue studies revealed that <i>SNORA37</i> exerted oncogenic roles in gastric cancer progression via facilitating CMTR1-ELAVL1 interaction. In clinical gastric cancer cases, high levels of <i>SNORA37</i>, <i>CMTR1</i>, <i>ELAVL1</i>, or <i>CD44</i> were associated with shorter survival and poor outcomes of patients.</p> Conclusions <p>These results indicated that <i>SNORA37</i>/CMTR1/ELAVL1 feedback loop drives gastric cancer progression via facilitating <i>CD44</i> alternative splicing.</p>