Tumor-initiating cells (TIC) are associated with tumor initiation, growth, metastasis, and recurrence. Aldehyde dehydrogenase 1A1 (ALDH1A1) is a TIC marker in many cancers, including breast cancer. However, the molecular mechanisms underlying ALDH1A1 functions in solid tumors remain largely unknown. Here we demonstrate that ALDH1A1 enzymatic activity facilitates breast tumor growth. Mechanistically, ALDH1A1 decreased the intracellular pH in breast cancer cells to promote phosphorylation of TAK1, activate NFκB signaling, and increase the secretion of GM-CSF, which led to myeloid-derived suppressor cell expansion and immunosuppression. Furthermore, the ALDH1A1 inhibitor disulfiram and chemotherapeutic agent gemcitabine cooperatively inhibited breast tumor growth and tumorigenesis by purging ALDH+ TICs and activating T-cell immunity. These findings elucidate how active ALDH1A1 modulates the immune system to promote tumor development, highlighting new therapeutic strategies for malignant breast cancer. Significance: ALDH1A1 enzyme activity induces MDSC expansion and triggers a procancer immune microenvironment to facilitate breast cancer progression, providing a novel therapeutic vulnerability in this disease.