Development of hypoxic regions is an indicator of poor prognosis in many tumors. Here, we demonstrate that HIF1α, the direct effector of hypoxia, partly through increases in SDF1α, induces recruitment of bone marrow-derived CD45+ myeloid cells containing Tie2+, VEGFR1+, CD11b+, and F4/80+ subpopulations, as well as endothelial and pericyte progenitor cells to promote neovascularization in glioblastoma. MMP-9 activity of bone marrow-derived CD45+ cells is essential and sufficient to initiate angiogenesis by increasing VEGF bioavailability. In the absence of HIF1α, SDF1α levels decrease, and fewer BM-derived cells are recruited to the tumors, decreasing MMP-9 and mobilization of VEGF. VEGF also directly regulates tumor cell invasiveness. When VEGF activity is impaired, tumor cells invade deep into the brain in the perivascular compartment.