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Hepatocellular carcinoma (HCC) is the most common type of primary liver cancer with a highly immunosuppressive tumor microenvironment and a typical pattern of disturbances in hepatic lipid metabolism. Long non‐coding RNAs are shown to play an important role in the regulation of gene expression, but much remains unknown between tumor microenvironment and lipid metabolism as a bridging molecule. Here, long intergenic nonprotein coding RNA 01116 (LINC01116) acts as this molecular which is frequently upregulated in HCC patients and associated with HCC progression in vitro and in vivo is identified. Mechanistically, LINC01116 stabilizes EWS RNA‐binding protein 1 (EWSR1) by preventing RAD18 E3 Ubiquitin Protein Ligase (RAD18) ‐mediated ubiquitination. The enhanced EWSR1 protein upregulates peroxisome proliferator activated receptor alpha (PPARA) and fatty acid binding protein1 (FABP1) expression, a long‐chain fatty acid (LCFA) transporter, and thus cancer cells outcompete T cells for LCFAs, especially linoleic acid, for seeding their own growth, leading to T cell malfunction and HCC malignant progression. In a preclinical animal model, the blockade of LINC01116 leads to enhanced efficacy of anti‐PD1 treatment accompanied by increased cytotoxic T cell and decreased exhausted T cell infiltration. Collectively, LINC01116 is an immunometabolic lncRNA and the LINC01116‐EWSR1‐PPARA‐FABP1 axis may be targetable for cancer immunotherapy. [ABSTRACT FROM AUTHOR]