Hypoxia plays a crucial role in lung adenocarcinoma (LUAD) proliferation and metastasis. However, the mechanisms underlying the interaction between the hypoxic microenvironment and immune resistance remain unclear. In this study, single-cell RNA sequencing (scRNA-seq) data from 15 LUAD patients were used to evaluate the complexity and heterogeneity of tumor microenvironment (TME). We identified new subtypes associated with advanced LUAD, including epithelial cells, fibroblasts, and myeloid cells. Furthermore, we found that the cell subtype module 3 (AGER, TIMP3) of epithelial cells exhibited higher hypoxia scores in advanced LUAD. Meanwhile, we also observed that RSG5 + fibroblast, AOPE+macrophage, S100B + macrophage, CCL17 + macrophage, and HLA-DRB5 + macrophage cells exhibited higher hypoxia scores in advanced LUAD patients. Moreover, spatial transcriptomic analysis revealed that with the gradual decrease of hypoxia score, the cell type score also gradually decreased. Cell communication analysis identified critical receptor-ligand pairs, which were associated with the activation of the PD-1/PD-L1 pathway. Finally, we developed a novel prognostic signature based on hypoxia-related molecular clusters, which possessed predictive power for both prognosis and immunotherapy response. The experimental results confirmed that hypoxia-related genes play a significant role in driving LUAD progression. In conclusion, our study provides valuable insights into the hypoxic and immunosuppressive tumor microenvironment, which serve as a potential prognostic marker and therapeutic target for LUAD.