Bladder cancer has a recurrence rate of up to 80% and many patients require multiple treatments that often fail, eventually leading to disease progression. In particular, standard of care for high-grade disease, Bacillus Calmette-Guérin (BCG), fails in 30% of patients. We have generated a novel oncolytic vaccinia virus (VACV) by mutating the F4L gene that encodes the virus homolog of the cell-cycle-regulated small subunit of ribonucleotide reductase (RRM2). The F4L-deleted VACVs are highly attenuated in normal tissues, and since cancer cells commonly express elevated RRM2 levels, have tumor-selective replication and cell killing. These F4L-deleted VACVs replicated selectively in immune-competent rat AY-27 and xenografted human RT112-luc orthotopic bladder cancer models, causing significant tumor regression or complete ablation with no toxicity. It was also observed that rats cured of AY-27 tumors by VACV treatment developed anti-tumor immunity as evidenced by tumor rejection upon challenge and by ex vivo cytotoxic T-lymphocyte assays. Finally, F4L-deleted VACVs replicated in primary human bladder cancer explants. Our findings demonstrate the enhanced safety and selectivity of F4L-deleted VACVs, with application as a promising therapy for patients with BCG-refractory cancers and immune dysregulation.