We have further defined mechanism(s) by which the drug OSU-03012 (OSU) kills tumor cells. OSU lethality was suppressed by knock down of PERK and enhanced by knock down of ATF6 and IRE1α. OSU treatment suppressed expression of the chaperone, BiP/GRP78, and did so through reduced stability of the protein. Knock down of BiP/GRP78 further enhanced OSU lethality. Overexpression of BiP/GRP78 abolished OSU toxicity. Pre-treatment of cells with OSU enhanced radiosensitivity to a greater extent than concomitant or sequential drug treatment with radiation exposure. Expression of a mutant active p110 PI3K, or mutant active forms of the EGFR in GBM cells did not differentially suppress OSU killing. In contrast loss of PTEN function reduced OSU lethality, without altering AKT, p70 S6K or mTOR activity, or the drug's ability to radiosensitize GBM cells. Knock down of PTEN protected cells from OSU and radiation treatment whereas re-expression of PTEN facilitated drug lethality and radiosensitization. In a dose-dependent fashion OSU prolonged the survival of mice carrying GBM tumors and interacted with radiotherapy to further prolong survival. Collectively, our data show that reduced BiP/GRP78 levels play a key role in OSU-3012 toxicity in GBM cells, and that this drug has in vivo activity against an invasive primary human GBM isolate.