Background: Targeting immune checkpoint proteins has recently gained substantial attention due to the dramatic success of this strategy in clinical trials for some cancers. Inducible T-cell co-stimulator ligand (ICOSLG) is a member of the B7 family of immune regulatory ligands, expression of which in cancer is implicated in disease progression due to regulation of antitumor adaptive immunity. Although aberrant ICOSLG expression has been reported in glioma cells, the underlying mechanisms that promote glioblastoma (GBM) progression remain elusive. Methods: Here, we investigated a causal role for ICOSLG in GBM progression by analyzing ICOSLG expression in both human glioma tissues and patient-derived GBM sphere cells (GSCs). We further examined its immune modulatory effects and the underlying molecular mechanisms. Results: Bioinformatics analysis and GBM tissue microarray showed that upregulation of ICOSLG expression was associated with poor prognosis in patients with GBM. ICOSLG expression was upregulated preferentially in mesenchymal GSCs but not in proneural GSCs in a tumor necrosis factor-α/nuclear factor-kappaB-dependent manner. Furthermore, ICOSLG expression by mesenchymal GSCs promoted expansion of T cells that produced interleukin-10. Knockdown of the gene encoding ICOSLG markedly reduced GBM tumor growth in immune competent mice, with a concomitant downregulation of interleukin-10 levels in the tumor microenvironment. Conclusions: Inhibition of the ICOSLG-inducible co-stimulator axis in GBM may provide a promising immunotherapeutic approach for suppressing a subset of GBM with an elevated mesenchymal ignature.