Prostate stem cell antigen (PSCA) is a highly glycosylated cell surface protein which is overexpressed in several malignancies including prostate, pancreas, and urinary bladder cancers. Tumor suppression has been reported by anti-PSCA antibody. Small and high affinity single chain antibodies (scFv) have been introduced as effective agents for cancer immunotargeting approaches. In the present study, we used a phage antibody display library of scFv and selected two antibodies against two immunodominant epitopes of PSCA by panning process. The reactivity of the scFvs for the corresponding epitopes was determined by phage ELISA. The binding specificity of antibodies to PSCA-expressing prostate cancer cell line, DU-145, was analyzed by flow cytometry. The antiproliferative and apoptotic induction effects were evaluated by MTT and Annexin-V assays, respectively. Results represented functional scFv C5-II which could bind specifically to DU-145 cells and significantly inhibited the proliferation of these cells (61%) with no effect on PSCA-negative cells. The antibody also induced apoptosis in the PSCA expressing cells. The percentage of the apoptotic cells after 24 hrs of exposure to 500 scFv/cell was 33.80%. These results demonstrate that the functional anti-PSCA scFv C5-II has the potential to be considered as a new agent for targeted therapy of prostate cancer.