Oncolytic virus (OV) therapies of cancer are based on the use of replication-competent, tumor-selective viruses with limited toxicity. Newcastle disease virus (NDV), an avian paramyxovirus, is a promising OV and is inherently tumor selective and cytotoxic only to tumor cells. Replication is restricted in normal cells. Despite encouraging phase I/II clinical trials with NDV, further refinements for tumor-specific targeting are needed to enhance its therapeutic index. Systemically delivered NDV fails to reach solid tumors in therapeutic concentrations and also spreads poorly within the tumors due to barriers including complement, innate immunity, and the extracellular matrix. Overcoming these hurdles is paramount to realizing the exceptional oncolytic efficacy of NDV. We engineered the F protein of NDV and generated a recombinant NDV (rNDV) whose F protein is cleavable exclusively by prostate-specific antigen (PSA). The rNDV replicated efficiently and specifically in prostate cancer (CaP) cells and 3-dimensional prostaspheres but failed to replicate in the absence of PSA. Induction of intracellular PSA production by a synthetic androgen analog (R1881) enhanced fusogenicity in androgen-responsive CaP cells. Further, PSA-cleavable rNDV caused specific lysis of androgen-independent and androgen-responsive/nonresponsive CaP cells and prostaspheres, with a half-maximal effective concentration (EC50) ranging from a multiplicity of infection of 0.01 to 0.1. PSA-retargeted NDV efficiently lysed prostasphere tumor mimics, suggesting efficacy in vivo. Also, PSA-cleavable NDV failed to replicate in chicken embryos, indicating no pathogenicity for chickens. Prostate-specific antigen targeting is likely to enhance the therapeutic index of rNDV owing to tumor-restricted replication and enhanced fusogenicity.