A series of novel indolyl-α-keto-1,3,4-oxadiazole derivatives have been synthesized by employing molecular iodine-mediated oxidative cyclization of acylhydrazones. In vitro anti cell proliferation activity of these derivatives against various cancer cells lines such as human lymphoblast (U937), leukemia (Jurkat & SB) and human breast (BT474) was investigated. Among the synthesized indolyl-α-keto-1,3,4-oxadiazoles 19a-p, only one compound (19e) exhibited significant antiproliferative activity against a panel of cell lines. The compound 19e with 3,4,5-trimethoxyphenyl motif, endowed strong cytotoxicity against U937, Jurkat, BT474 and SB cancer cells with IC values of 7.1, 3.1, 4.1, and 0.8 µM, respectively. Molecular docking studies suggested a potential binding mode for 19e in the colchicine binding site of tubulin. When tested for in vitro tubulin polymerizaton, 19e inhibited tubulin polymezations (IC = 10.66 µM) and induced apoptosis through caspase 3/7 activation. Further, the derivative 19e did not cause necrosis when measured using lactate dehydrogenase assay.