Mesothelin (MSLN) is an attractive immuno-oncology target, but the development of MSLN-targeting therapies has been impeded by tumor shedding of soluble MSLN (sMSLN), on-target off-tumor activity, and an immunosuppressive tumor microenvironment. We sought to engineer an antibody-based, MSLN-targeted T-cell engager (αMSLN/αCD3) with enhanced ability to discriminate high MSLN-expressing tumors from normal tissue, and activity in the presence of sMSLN. We also studied the in vivo antitumor efficacy of this molecule (NM28-2746) alone and in combination with the multifunctional checkpoint inhibitor/T-cell co-activator NM21-1480 (αPD-L1/α4-1BB). Cytotoxicity and T-cell activation induced by NM28-2746 were studied in co-cultures of peripheral blood mononuclear cells and cell lines exhibiting different levels of MSLN expression, including in the presence of soluble MSLN. Xenotransplant models of human pancreatic cancer were used to study the inhibition of tumor growth and stimulation of T-cell infiltration into tumors induced by NM28-2746 alone and in combination with NM21-1480. The bivalent αMSLN T-cell engager NM28-2746 potently induced T-cell activation and T-cell mediated cytotoxicity of high MSLN-expressing cells but had much lower potency against low MSLN-expressing cells. A monovalent counterpart of NM28-2746 had much lower ability to discriminate high MSLN-expressing from low MSLN-expressing cells. The bivalent molecule retained this discriminant ability in the presence of high concentrations of sMSLN. In xenograft models, NM28-2746 exhibited significant tumor suppressing activity, which was significantly enhanced by combination therapy with NM21-1480. NM28-2746, alone or in combination with NM21-1480, may overcome shortcomings of previous MSLN-targeted immuno-oncology drugs, exhibiting enhanced discrimination of high MSLN-expressing cell activity in the presence of sMSLN.