A novel USP7 inhibitor, DHPO, was identified as a potent therapeutic agent for gastric cancer (GC). DHPO effectively inhibits USP7, leading to ferroptosis in GC cells. Mechanistically, DHPO induces ferroptosis by deubiquitinating Stearoyl-CoA Desaturase (SCD), thereby promoting lipid peroxidation, mitochondrial damage, and iron overload. In vitro and in vivo studies demonstrated that DHPO significantly suppresses tumor growth and metastasis in GC models without causing significant toxicity. DHPO treatment reduced cell viability, clonogenicity, and migration in GC cells, while increasing lipid ROS, MDA accumulation, and iron overload. In vivo, DHPO treatment in orthotopic tumor models significantly reduced tumor size and metastasis. The study highlights USP7 as a key regulator of ferroptosis in GC and identifies DHPO as a promising therapeutic strategy for GC treatment through SCD regulation.A novel USP7 inhibitor, DHPO, was identified as a potent therapeutic agent for gastric cancer (GC). DHPO effectively inhibits USP7, leading to ferroptosis in GC cells. Mechanistically, DHPO induces ferroptosis by deubiquitinating Stearoyl-CoA Desaturase (SCD), thereby promoting lipid peroxidation, mitochondrial damage, and iron overload. In vitro and in vivo studies demonstrated that DHPO significantly suppresses tumor growth and metastasis in GC models without causing significant toxicity. DHPO treatment reduced cell viability, clonogenicity, and migration in GC cells, while increasing lipid ROS, MDA accumulation, and iron overload. In vivo, DHPO treatment in orthotopic tumor models significantly reduced tumor size and metastasis. The study highlights USP7 as a key regulator of ferroptosis in GC and identifies DHPO as a promising therapeutic strategy for GC treatment through SCD regulation.