Pseudogenes are initially regarded as nonfunctional genomic sequences, but some pseudogenes regulate tumor initiation and progression by interacting with other genes to modulate their transcriptional activities. Olfactory receptor family 7 subfamily E member 47 pseudogene (OR7E47P) is expressed broadly in lung tissues and has been identified as a positive regulator in the tumor microenvironment (TME) of lung adenocarcinoma (LUAD). This study aimed to elucidate the correlation between OR7E47P and tumor immunity in lung squamous cell carcinoma (LUSC). Clinical and molecular information from The Cancer Genome Atlas (TCGA) LUSC cohort was used to identify OR7E47P-related immune genes (ORIGs) by weighted gene correlation network analysis (WGCNA). Based on the ORIGs, 2 OR7E47P clusters were identified using non-negative matrix factorization (NMF) clustering, and the stability of the clustering was tested by an extreme gradient boosting classifier (XGBoost). LASSO-Cox and stepwise regressions were applied to further select prognostic ORIGs and to construct a predictive model (ORPScore) for immunotherapy. The Botling cohorts and 8 immunotherapy cohorts (the Samstein, Braun, Jung, Gide, IMvigor210, Lauss, Van Allen, and Cho cohorts) were included as independent validation cohorts. OR7E47P expression was positively correlated with immune cell infiltration and enrichment of immune-related pathways in LUSC. A total of 57 ORIGs were identified to classify the patients into 2 OR7E47P clusters (Cluster 1 and Cluster 2) with distinct immune, mutation, and stromal programs. Compared to Cluster 1, Cluster 2 had more infiltration by immune and stromal cells, lower mutation rates of driver genes, and higher expression of immune-related proteins. The clustering performed well in the internal and 5 external validation cohorts. Based on the 7 ORIGs (HOPX, STX2, WFS, DUSP22, SLFN13, GGCT, and CCSER2), the ORPScore was constructed to predict the prognosis and the treatment response. In addition, the ORPScore was a better prognostic factor and correlated positively with the immunotherapeutic response in cancer patients. The area under the curve values ranged from 0.584 to 0.805 in the 6 independent immunotherapy cohorts. Our study suggests a significant correlation between OR7E47P and TME modulation in LUSC. ORIGs can be applied to molecularly stratify patients, and the ORPScore may serve as a biomarker for clinical decision-making regarding individualized prognostication and immunotherapy.