Bacteriophage (phage), which are viruses that infect bacteria only, have shown promise as vehicles for targeted cancer gene therapy, albeit with poor efficiency. Recently, we generated an improved version of phage vectors by incorporating cis genetic elements of adeno‐associated virus (AAV). This novel AAV/phage hybrid (AAVP) efficiently delivered systemically administered therapeutic genes to various tumor targets by displaying an integrin tumor‐targeting ligand on the phage capsid. However, inherent limitations in bacteriophage mean that these AAVP vectors still need to be improved. One of the limitations of AAVP in mammalian cells may be its susceptibility to proteasomal degradation. The proteasome is upregulated in cancer and it is known that it constitutes a barrier to gene delivery by certain eukaryotic viruses. We report here that inhibition of proteasome improved targeted reporter gene delivery by AAVP in cancer cells in vitro and in tumors in vivo after intravenous vector administration to tumor‐bearing mice. We also show enhanced targeted tumor cell killing by AAVP upon proteasome inhibition. The AAVP particles persisted significantly in cancer cells in vitro and in tumors in vivo after systemic administration, and accumulated polyubiquitinated coat proteins. Our results suggest that the proteasome is indeed a barrier to tumor targeting by AAVP and indicate that a combination of proteasome‐inhibiting drugs and AAVP should be considered for clinical anticancer therapy.