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We present primary results from the phase 1b GO29754 study evaluating the safety and tolerability of atezolizumab, a programmed death-ligand 1 inhibitor, alone and in combination with azacitidine, a hypomethylating agent (HMA), in patients with relapsed/refractory (R/R) or HMA-naïve myelodysplastic syndrome (MDS). Patients with R/R MDS received atezolizumab for 12 months (cohort A) or atezolizumab plus azacitidine for 6 cycles followed by atezolizumab as maintenance for 8 cycles (cohort B). Patients with HMA-naïve MDS received atezolizumab plus azacitidine until loss of clinical benefit (cohort C). Safety, activity, and exploratory end points were investigated. Forty-six patients were enrolled and received treatment (cohort A, n = 11; cohort B, n = 14; cohort C, n = 21). All patients experienced ≥1 adverse event (AE) on study, and all patients discontinued atezolizumab. In cohort A, 7 patients (63.6%) died, and no patients responded. In cohort B, 8 patients (57.1%) discontinued azacitidine, 11 (78.6%) died, and 2 (14.3%) responded. In cohort C, all 21 patients discontinued azacitidine, 13 died (61.9%), and 13 (61.9%) responded. The study was terminated by the sponsor before completion of recruitment because of the unexpected high early death rate in cohort C (6 [46.2%] of 13 deaths were due to AEs and occurred within the first 4 treatment cycles.). The high death rate and poor efficacy observed in this study do not support a favorable risk-benefit profile for atezolizumab as a single agent or in combination with azacitidine in R/R or HMA-naïve MDS. This trial was registered at www.clinicaltrials.gov as #NCT02508870.