Background/objectives The assessment of nutritional status and the quality of life in patients with gastric cancer has become one of the important goals of current clinical treatment. The purpose of this study was to assess the nutritional status in hospitalized gastric cancer patients by using patient-generated subjective global assessment (PG-SGA) and to analyze the influence of nutritional status on the patients' quality of life (QOL). Methods We reviewed the pathological diagnosis of gastric cancer for 2322 hospitalized patients using PG-SGA to assess their nutritional status and collected data on clinical symptoms, the anthropometric parameters (height, weight, body mass index (BMI), mid-arm circumference (MAC), triceps skin-fold thickness (TSF), and hand-grip strength (HGS). We also collected laboratory data (prealbumin, albumin, hemoglobin) within 48 h after the patient was admitted to the hospital. The 30-item European Organization for Research and Treatment of Cancer Core Quality of Life Questionnaire (EORTC QLQ-C30) was used for QOL assessment in all patients. Results By using PG-SGA, we found 80.4% of the patients were malnourished (score >= 4) and 45.1% of the patients required urgent nutritional support (score >= 9). In univariate analysis, old age (> 65 years, p < 0.001), female (p = 0.007), residence in a village (p = 0.004), a lower level of education (p < 0.001), and self-paying (p < 0.001) were indicated as risk factors of patients with gastric cancer to be suffering from severe malnutrition. There was a negative correlation between PG-SGA and various nutritional parameters (p < 0.05). The quality of life was significantly different in gastric cancer patients with different nutritional status (p < 0.01). Conclusion Malnutrition of hospitalized patients with gastric cancer in China is common and seriously affects the patients' quality of life. The nutritional status should be evaluated in a timely manner and reasonable nutritional intervention should be provided as soon as possible. The PG-SGA was fit for using as a clinical nutrition assessment method, being worthy of clinical application.