Chimeric antigen receptor (CAR)-T cell therapy shows impressive efficacy treating hematologic malignancies but requires further optimization in solid tumors. Here, we developed a TMIGD2 optimized potent/persistent (TOP) CAR that incorporated the costimulatory domain of TMIGD2, a T and NK cell costimulator, and monoclonal antibodies targeting the IgV domain of B7-H3, an immune checkpoint expressed on solid tumors and tumor vasculature. Comparing second- and third-generation B7-H3 CARs containing TMIGD2, CD28, and/or 4-1BB costimulatory domains revealed superior antitumor responses in B7-H3.TMIGD2 and B7-H3.CD28.4-1BB CAR-T cells in vitro. Comparing these two constructs using in vivo orthotopic human cancer models demonstrated that B7-H3.TMIGD2 CAR-T cells had equivalent or superior antitumor activity, survival, expansion, and persistence. Mechanistically, B7-H3.TMIGD2 CAR-T cells maintained mitochondrial metabolism; produced less cytokines; and established fewer exhausted cells, more central memory cells, and a larger CD8/CD4 T cell ratio. These studies demonstrate that the TOP CAR with TMIGD2 costimulation offered distinct benefits from CD28.41BB costimulation and is effective against solid tumors.