Abstract Purpose: Immune checkpoint inhibitors combined with antiangiogenic agents produce benefits in the treatment of advanced hepatocellular carcinoma (HCC). We investigated the efficacy and immunomodulatory activity of cabozantinib alone and combined with anti-PD1 in experimental models of HCC, and explored the potential target population that might benefit from this combination. Experimental Design: C57BL/6J mice bearing subcutaneous Hepa1-6 or Hep53.4 tumors received cabozantinib, anti-PD1, their combination, or placebo. Tumor and blood samples were analyzed by flow cytometry, IHC, transcriptome, and cytokine profiling. Cabozantinib-related effects were validated in a colorectal cancer patient-derived xenograft model. Transcriptomic data from three human HCC cohorts (cohort 1: n = 167, cohort 2: n = 57, The Cancer Genome Atlas: n = 319) were used to cluster patients according to neutrophil features, and assess their impact on survival. Results: The combination of cabozantinib and anti-PD1 showed increased antitumor efficacy compared with monotherapy and placebo (P < 0.05). Cabozantinib alone significantly increased neutrophil infiltration and reduced intratumor CD8+PD1+ T-cell proportions, while the combination with anti-PD1 further stimulated both effects and significantly decreased regulatory T cell (Treg) infiltration (all P < 0.05). In blood, cabozantinib and especially combination increased the proportions of overall T cells (P < 0.01) and memory/effector T cells (P < 0.05), while lowering the neutrophil-to-lymphocyte ratio (P < 0.001 for combination). Unsupervised clustering of human HCCs revealed that high tumor enrichment in neutrophil features observed with the treatment combination was linked to less aggressive tumors with more differentiated and less proliferative phenotypes. Conclusions: Cabozantinib in combination with anti-PD1 enhanced antitumor immunity by bringing together innate neutrophil-driven and adaptive immune responses, a mechanism of action which favors this approach for HCC treatment.