Synovial sarcoma (SyS) is an aggressive neoplasm driven by the SS18-SSX fusion, and is characterized by low T cell infiltration. Here, we studied the cancer-immune interplay in SyS using an integrative approach that combines single-cell RNA sequencing (scRNA-seq), spatial profiling and genetic and pharmacological perturbations. scRNA-seq of 16,872 cells from 12 human SyS tumors uncovered a malignant subpopulation that marks immune-deprived niches in situ and is predictive of poor clinical outcomes in two independent cohorts. Functional analyses revealed that this malignant cell state is controlled by the SS18-SSX fusion, is repressed by cytokines secreted by macrophages and T cells, and can be synergistically targeted with a combination of HDAC and CDK4/CDK6 inhibitors. This drug combination enhanced malignant-cell immunogenicity in SyS models, leading to induced T cell reactivity and T cell-mediated killing. Our study provides a blueprint for investigating heterogeneity in fusion-driven malignancies and demonstrates an interplay between immune evasion and oncogenic processes that can be co-targeted in SyS and potentially in other malignancies.