 Solution

Let $\lambda =|T|$ and choose an infinite cardinal $\kappa$ satisfying ${\kappa }^{\lambda }=\kappa$, for example $\kappa =2^{\lambda }$. Take $M\models T$ of cardinality $\kappa$. By assumption, every $p\in S_1(M)$ is definable.

For each parameter-free formula scheme $\phi (x;y)$, the definition $d_p\phi (y)$ is a formula with finitely many parameters from $M$. There are at most $\kappa$ such formulas. A definable type is completely determined by choosing one definition for each of the at most $\lambda$ formula schemes, soThe same count applies to every model of cardinality $\kappa$, and therefore $T$ is $\kappa$-stable. Hence $T$ is a stable theory.