The combination of melphalan, prednisone and thalidomide (MPT) has demonstrated efficacy and acceptable toxicity in newly diagnosed and relapsed/refractory patients with multiple myeloma (MM). Panobinostat is a potent oral pan-deacetylase inhibitor (pan-DACi). In preclinical and clinical studies, panobinostat showed good anti-myeloma activity in combination with several agents. This phase II study evaluated the combination of a fixed dose of MPT with escalating doses of panobinostat (three times weekly for 3 weeks, followed by a 9-day rest period) in relapsed/refractory MM. We used a two-stage design to determine whether the combination was safe and effective. At least a partial response was observed in 38.5% of patients. The maximum tolerated dose of panobinostat in combination with MPT could not be determined due to the high rate of dose-limiting toxicities experienced with panobinostat at doses of 10 and 15 mg. The most common grade 3/4 adverse events were neutropenia (71%) and thrombocytopenia (35.5%). In conclusion, MPT in combination with panobinostat three times weekly for 3 weeks followed by a 9-day rest period is not well tolerated in patients with relapsed/refractory MM. Future studies should evaluate alternative dose schedules of panobinostat.