BCG, the current gold standard immunotherapy for bladder cancer, exerts its activity via recruitment of neutrophils to the tumor microenvironment. Many patients do not respond to BCG therapy, indicating the need to understand the mechanism of action of BCG-stimulated neutrophils and to identify ways to overcome resistance to BCG therapy. Using isolated human neutrophils stimulated with BCG, we found that TNF-α is the key mediator secreted by BCG-stimulated neutrophils. RT4v6 human bladder cancer cells, which express TNFR1, CD95/Fas, CD95 ligand/FasL, DR4, and DR5, were resistant to BCG-stimulated neutrophil conditioned medium but effectively killed by the combination of conditioned medium and Smac mimetic. rhTNF-α and rhFasL, but not rhTRAIL, in combination with Smac mimetic, generated signature molecular events similar to those produced by BCG-stimulated neutrophils in combination with Smac mimetic. However, experiments using neutralizing antibodies to these death ligands showed that TNF-α secreted from BCG-stimulated neutrophils was the key mediator of anticancer action. These findings explain the mechanism of action of BCG and identified Smac mimetics as potential combination therapeutic agents for bladder cancer.