Reovirus is a naturally oncolytic virus that preferentially replicates in Ras-transformed cells and is currently undergoing clinical trials as a cancer therapeutic. Ras transformation promotes reovirus oncolysis by enhancing virion disassembly during entry, viral progeny production, and virus release through apoptosis; however, the mechanism behind the latter is not well understood. Here, we show that reovirus alters the intracellular location of oncogenic Ras to induce apoptosis of H-RasV12-transformed fibroblasts. Reovirus infection decreases Ras palmitoylation levels and causes accumulation of Ras in the Golgi through Golgi fragmentation. With the Golgi being the site of Ras palmitoylation, treatment of target cells with the palmitoylation inhibitor, 2-bromopalmitate (2BP), prompts a greater accumulation of H-RasV12 in the Golgi, and a dose-dependent increase in progeny virus release and subsequent spread. Conversely, tethering H-RasV12 to the plasma membrane (thereby preventing its movement to the Golgi) allows for efficient virus production, but results in basal levels of reovirus-induced cell death. Analysis of Ras downstream signaling reveals that cells expressing cycling H-RasV12 have elevated levels of phosphorylated JNK (c-Jun N-terminal kinase), and that Ras retained at the Golgi body by 2BP increases activation of the MEKK1/MKK4/JNK signaling pathway to promote cell death. Collectively, our data suggest that reovirus induces Golgi fragmentation of target cells, and the subsequent accumulation of oncogenic Ras in the Golgi body initiates apoptotic signaling events required for virus release and spread.