Oncolytic virotherapy using reovirus is a promising new anti-cancer treatment with potential for use in humans and dogs. Because reovirus monotherapy shows limited efficacy in human and canine cancer patients, the clinical development of a combination therapy is necessary. To identify candidate components of such a combination, we screened a 285-compound drug library for those that enhanced reovirus cytotoxicity in a canine melanoma cell line. Here, we show that exposure to an inhibitor of the ataxia telangiectasia mutated protein (ATM) enhances the oncolytic potential of reovirus in five of six tested canine melanoma cell lines. Specifically, the ATM inhibitor potentiated reovirus replication in cancer cells along with promoting the lysosomal activity, resulting in an increased proportion of caspase-dependent apoptosis and cell cycle arrest at G2/M compared to those observed with reovirus alone. Overall, our study suggests that the combination of reovirus and the ATM inhibitor may be an attractive option in cancer therapy.