In solid tumors, the presence of lymph node-like structures called tertiary lymphoid structures (TLS) is associated with improved patient survival. However, little is known about how TLS develop in cancer, how their function affects survival, and whether they are affected by cancer therapy. In this study, we used multispectral microscopy, quantitative pathology, and gene expression profiling to analyze TLS formation in human lung squamous cell carcinoma (LSCC) and in an experimental model of lung TLS induction. We identified a niche of CXCL13 ⁺ perivascular and CXCL12 ⁺ LTB ⁺ and PD-L1 ⁺ epithelial cells supporting TLS formation. We also characterized sequential stages of TLS maturation in LSCC culminating in the formation of germinal centers (GC). In untreated patients, TLS density was the strongest independent prognostic marker. Furthermore, TLS density correlated with GC formation and expression of adaptive immune response-related genes. In patients treated with neoadjuvant chemotherapy, TLS density was similar, but GC formation was impaired and the prognostic value of TLS density was lost. Corticosteroids are coadministered with chemotherapy to manage side effects in LSCC patients, so we evaluated whether they impaired TLS development independently of chemotherapy. TLS density and GC formation were each reduced in chemotherapy-naïve LSCC patients treated with corticosteroids before surgery, compared with untreated patients, a finding that we confirmed in the experimental model of lung TLS induction. Overall, our results highlight the importance of GC formation in TLS during tumor development and treatment.Significance: Corticosteroid treatment during chemotherapy negatively affects the development of tertiary lymphoid structures and abrogates their prognostic value in patients with lung cancer. Cancer Res; 78(5); 1308-20. ©2018 AACR.