Tissue hypoxia and necrosis represent pathophysiologic and histologic hallmarks of glioblastoma (GBM). Although hypoxia inducible factor 1α (HIF-1α) plays crucial roles in the malignant phenotypes of GBM, developing HIF-1α-targeted agents has been hampered by the lack of a suitable preclinical model that recapitulates the complex biology of clinical GBM. We present a new GBM model, MGG123, which was established from a recurrent human GBM. Orthotopic xenografting of stem-like MGG123 cells reproducibly generated lethal tumors that were characterized by foci of palisading necrosis, hypervascularity, and robust stem cell marker expression. Perinecrotic neoplastic cells distinctively express HIF-1α and are proliferative in both xenografts and the patient tissue. The xenografts contain scattered hypoxic foci that were consistently greater than 50 μm distant from blood vessels, indicating intratumoral heterogeneity of oxygenation. Hypoxia enhanced HIF-1α expression in cultured MGG123 cells, which was abrogated by the HIF-1α inhibitors digoxin or ouabain. In vivo, treatment of orthotopic MGG123 xenografts with digoxin decreased HIF-1α expression, vascular endothelial growth factor mRNA levels, and CD34-positive vasculature within the tumors, and extended survival of mice bearing the aggressive MGG123 GBM. This preclinical tumor model faithfully recapitulates the GBM-relevant hypoxic microenvironment and stemness and is a suitable platform for studying disease biology and developing hypoxia-targeted agents.