YIV-906 (PHY906) is a standardized botanical cancer drug candidate developed with a systems biology approach-inspired by a traditional Chinese herbal formulation, historically used to treat gastrointestinal symptoms including diarrhea, nausea and vomiting. In combination with chemotherapy and/or radiation therapy, preclinical and clinical results suggest that YIV-906 has the potential to prolong survival and improve quality of life for cancer patients. Here, we demonstrated that YIV-906 plus anti-PD1 could eradicate all Hepa 1-6 tumors in all tumor bearing mice. YIV-906 was found to have multiple mechanisms of action to enhance adaptive and innate immunity. In combination, YIV-906 reduced PD1 or counteracted PD-L1 induction caused by anti-PD1 which led to higher T-cell activation gene expression of the tumor. In addition, YIV-906 could reduce immune tolerance by modulating IDO activity and reducing monocytic MDSC of the tumor. The combination of anti-PD1 and YIV-906 generated acute inflammation in the tumor microenvironment with more M1-like macrophages. YIV-906 could potentiate the action of interferon gamma (IFNg) to increase M1-like macrophage polarization while inhibiting IL4 action to decrease M2 macrophage polarization. Flavonoids from YIV-906 were responsible for modulating IDO activity and potentiating IFNg action in M1-like macrophage polarization. In conclusion, YIV-906 could act as an immunomodulator and enhance the innate and adaptive immune response and potentiate anti-tumor activity for immunotherapies to treat cancer.