Oncolytic viruses hold promise for the treatment of cancer, but their interaction with the tumor microenvironment needs to be elucidated for optimal tumor cell killing. Because the CXCR4 receptor for the stromal cell-derived factor-1 (SDF-1/CXCL12) chemokine is one of the key stimuli involved in signaling interactions between tumor cells and their stromal microenvironment, we used oncolytic virotherapy with a CXCR4 antagonist to target the CXCL12/CXCR4 signaling axis in a triple-negative 4T1 breast carcinoma in syngeneic mice. We show here that CXCR4 antagonist expression from an oncolytic vaccinia virus delivered intravenously to mice with orthotopic tumors attains higher intratumoral concentration than its soluble counterpart and exhibits increased efficacy over that mediated by oncolysis alone. A systemic delivery of the armed virus after resection of the primary tumor was efficacious in inhibiting the development of spontaneous metastasis and increased overall tumor-free survival. Inhibition of tumor growth with the armed virus was associated with destruction of tumor vasculature, reductions in expression of CXCL12 and VEGF, and decrease in intratumoral numbers of bone marrow-derived endothelial and myeloid cells. These changes led to induction of antitumor antibody responses and resistance to tumor rechallenge. Engineering an oncolytic virus armed with a CXCR4 antagonist represents an innovative strategy that targets multiple elements within the tumor microenvironment. As such, this approach could have a significant therapeutic impact against primary and metastatic breast cancer.