Immune checkpoint blockade (ICB) has achieved remarkable success in cancer treatment; however, enhancing its efficacy remains a significant challenge. Selectively restoring tumour-induced immune deficiency within the tumour microenvironment is considered an ideal strategy for unleashing antitumour immunity without causing severe toxicity. Here, we describe an immunoregulatory micropeptide encoded by a long non-coding RNA (lncRNA) gene identified through comprehensive bioinformatic screening, which we designate as UEIS (USP30-AS1 encoded immune suppressor). UEIS was found to be upregulated in tumour-associated macrophages (TAMs) and to drive macrophages toward a pro-tumorigenic phenotype, thereby inhibiting antitumour T-cell immunity. Mechanistically, the expression of UEIS is induced by cGAS-STING-type I interferon (IFN) signalling at a relatively late stage following tumoral DNA stimulation. Subsequently, UEIS exerts a negative feedback regulation on the type I IFN signalling pathway by forming biomolecular condensates with TBK1. This interaction sequesters TBK1, thereby inhibiting its interaction with STING and consequently suppressing downstream signalling events. Intriguingly, both an intrinsically disordered region and an alpha helix at the extreme N-terminus of UEIS were found to be essential for its function. A peptide designed to disrupt UEIS-TBK1 condensation successfully inhibited UEIS function, leading to reduced tumour growth and increased response to ICB. Thus, we identify the endogenous existence of a lncRNA-encoded micropeptide and reveal its inhibitory effect on cGAS-STING-type I IFN signalling via a feedback loop in TAMs. These findings highlight UEIS as a promising therapeutic target for cancer treatment.