The determinants of clinical benefit from combined immune checkpoint blockade (CICB) targeting CTLA-4 and PD-1 are only partly understood. As this and other immunotherapy combinations are used more widely across cancer types and disease stages, optimal ways to identify patients most likely to benefit, and to reduce the risk of treatment side effects is imperative. We profiled the blood, tumour and gut microbiome of advanced melanoma patients treated with CICB, paired with pre-clinical models to evaluate biomarkers of response and toxicity. Tumour-associated immune and genomic biomarkers of response to CICB were similar to those identified for ICB monotherapy, and toxicity from CICB was associated with a more diverse peripheral T-cell repertoire. Gut microbiota greatly influenced the likelihood of toxicity, with a significantly higher abundance of Bacteroides intestinalis in patients experiencing severe toxicity, mediated by upregulation of mucosal IL-1β in patient samples of colitis and in pre-clinical models. Gut microbial or cytokine manipulation offer potential new therapeutic angles to mitigate toxicity in high-intensity cancer immunotherapy.