Abstract Purpose: We hypothesized that resistance to hypomethylating agents (HMA) among patients with myelodysplastic syndrome (MDS) and chronic myelomonocytic leukemia (CMML) would be overcome by combining a programmed death-ligand 1 antibody with an HMA. Patients and Methods: We conducted a Phase I/II, multicenter clinical trial for patients with MDS not achieving an International Working Group response after at least 4 cycles of an HMA (“refractory”) or progressing after a response (“relapsed”) with 3+ or higher risk MDS by the revised International Prognostic Scoring System (IPSS-R) and CMML-1 or -2. Phase I consisted of a 3+3 dose-escalation design beginning with guadecitabine at 30 mg/m2 and escalating to 60 mg/m2 Days 1 to 5 with fixed-dose atezolizumab: 840 mg intravenously Days 8 and 22 of a 28-day cycle. Primary endpoints were safety and tolerability; secondary endpoints were overall response rate (ORR) and survival. Results: Thirty-three patients, median age 73 (range 54–85), were treated. Thirty patients had MDS and 3 had CMML, with 30% relapsed and 70% refractory. No dose-limiting toxicities were observed in Phase I. There were 3 (9%) deaths in ≤ 30 days. Five patients (16%) came off study for drug-related toxicity. Immune-related adverse events (IRAE) occurred in 12 (36%) patients (4 grade 3, 3 grade 2, and 5 grade1). ORR was 33% [95% confidence interval (CI), 19%–52%] with 2 complete remission (CR), 3 hematologic improvement, 5 marrow CR, and 1 partial remission. Median overall survival was 15.1 (95% CI, 8.5–25.3) months. Conclusions: Guadecitabine with atezolizumab has modest efficacy with manageable IRAEs and typical cytopenia-related safety concerns for patients with relapsed or refractory MDS and CMML.