Oncolytic viruses engineered to replicate in tumour cells but not in normal cells could be used as tumour-specific vectors carrying the therapeutic genes. We previously developed a telomerase-specific oncolytic adenovirus, OBP-301, that causes cell death in human cancer cells with telomerase activities. Here, we further modified OBP-301 to express the wild-type p53 tumour suppressor gene (OBP-702), and investigated whether OBP-702 induces stronger antitumour activity than OBP-301. The antitumour effect of OBP-702 was compared to that of OBP-301 on OBP-301-sensitive (H358 and H460) and OBP-301-resistant (T.Tn and HSC4) human cancer cells. OBP-702 suppressed the viability of both OBP-301-sensitive and OBP-301-resistant cancer cells more efficiently than OBP-301. OBP-702 caused increased apoptosis compared to OBP-301 or a replication-deficient adenovirus expressing the p53 gene (Ad-p53) in H358 and T.Tn cells. Adenovirus E1A-mediated p21 and MDM2 downregulation was involved in the apoptosis caused by OBP-702. Moreover, OBP-702 significantly suppressed tumour growth in subcutaneous tumour xenograft models compared to monotherapy with OBP-301 or Ad-p53. Our data demonstrated that OBP-702 infection expressed adenovirus E1A and then inhibited p21 and MDM2 expression, which in turn efficiently induced apoptotic cell death. This novel apoptotic mechanism suggests that the p53-expressing OBP-702 is a promising antitumour reagent for human cancer and could improve the clinical outcome.