Oncolytic virotherapy has become an important strategy in cancer immunotherapy. Oncolytic virus (OV) can reshape the tumor microenvironment (TME) through its replication-mediated oncolysis and transgene-produced anticancer effect, inducing an antitumor immune response and creating favorable conditions for the combination of other therapeutic measures. Extensive preclinical and clinical data have suggested that OV-based combination therapy has definite efficacy and promising prospects. Recently, several clinical trials of oncolytic virotherapy combined with immunotherapy have made breakthroughs. This review comprehensively elaborates the OV types and their targeting mechanisms, the selection of anticancer genes armed in OVs, and the therapeutic modes of action and strategies of OVs to provide a theoretical basis for the better design and construction of OVs and the optimization of OV-based therapeutic strategies.