The interplay between glioblastoma stem cells (GSCs) and tumor-associated macrophages (TAMs) promotes progression of glioblastoma multiforme (GBM). However, the detailed molecular mechanisms underlying the relationship between these two cell types remain unclear. Here, we demonstrate that ARS2 (arsenite-resistance protein 2), a zinc finger protein that is essential for early mammalian development, plays critical roles in GSC maintenance and M2-like TAM polarization. ARS2 directly activates its novel transcriptional target MGLL, encoding monoacylglycerol lipase (MAGL), to regulate the self-renewal and tumorigenicity of GSCs through production of prostaglandin E2 (PGE2), which stimulates β-catenin activation of GSC and M2-like TAM polarization. We identify M2-like signature downregulated by which MAGL-specific inhibitor, JZL184, increased survival rate significantly in the mouse xenograft model by blocking PGE2 production. Taken together, our results suggest that blocking the interplay between GSCs and TAMs by targeting ARS2/MAGL signaling offers a potentially novel therapeutic option for GBM patients.