Targeting the PD-1/PD-L1 axis has transformed the field of immune-oncology. While conventional wisdom initially postulated that PD-L1 serves as the inert ligand for PD-1, an emerging body of literature suggests that PD-L1 has cell-intrinsic functions in immune and cancer cells. In line with these studies, here we show that engagement of PD-L1 via cellular ligands or agonistic antibodies, including those used in the clinic, potently inhibits the type I interferon pathway in cancer cells. Hampered type I interferon responses in PD-L1-expressing cancer cells resulted in enhanced infection with oncolytic viruses in vitro and in vivo. Consistently, PD-L1 expression marked tumor explants from cancer patients that were best infected by oncolytic viruses. Mechanistically, PD-L1 suppressed type I interferon by promoting a metabolic shift characterized by enhanced glucose uptake and glycolysis rate. Lactate generated from glycolysis was the key metabolite responsible for inhibiting type I interferon responses and enhancing oncolytic virus infection in PD-L1-expressing cells. In addition to adding mechanistic insight into PD-L1 intrinsic function and showing that PD-L1 has a broader impact on immunity and cancer biology besides acting as a ligand for PD-1, our results will also help guide the numerous efforts currently ongoing to combine PD-L1 antibodies with oncolytic virotherapy in clinical trials.Once sentence summaryPD-L1 promotes oncolytic virus efficacy.