Immune-mediated anti-tumoral responses, elicited by oncolytic viruses and augmented with checkpoint inhibition, may be an effective treatment approach for glioblastoma. Here in this multicenter phase 1/2 study we evaluated the combination of intratumoral delivery of oncolytic virus DNX-2401 followed by intravenous anti-PD-1 antibody pembrolizumab in recurrent glioblastoma, first in a dose-escalation and then in a dose-expansion phase, in 49 patients. The primary endpoints were overall safety and objective response rate. The primary safety endpoint was met, whereas the primary efficacy endpoint was not met. There were no dose-limiting toxicities, and full dose combined treatment was well tolerated. The objective response rate was 10.4% (90% confidence interval (CI) 4.2–20.7%), which was not statistically greater than the prespecified control rate of 5%. The secondary endpoint of overall survival at 12 months was 52.7% (95% CI 40.1–69.2%), which was statistically greater than the prespecified control rate of 20%. Median overall survival was 12.5 months (10.7–13.5 months). Objective responses led to longer survival (hazard ratio 0.20, 95% CI 0.05–0.87). A total of 56.2% (95% CI 41.1–70.5%) of patients had a clinical benefit defined as stable disease or better. Three patients completed treatment with durable responses and remain alive at 45, 48 and 60 months. Exploratory mutational, gene-expression and immunophenotypic analyses revealed that the balance between immune cell infiltration and expression of checkpoint inhibitors may potentially inform on response to treatment and mechanisms of resistance. Overall, the combination of intratumoral DNX-2401 followed by pembrolizumab was safe with notable survival benefit in select patients (ClinicalTrials.gov registration: NCT02798406).