Objective: To evaluate the feasibility and prophylactic effect of psilocybin as well as its effects on hypothalamic functional connectivity (FC) in patients with chronic cluster headache (CCH). Background: CCH is an excruciating and difficult-to-treat disorder with incompletely understood pathophysiology, although hypothalamic dysfunction has been implicated. Psilocybin may have beneficial prophylactic effects, but clinical evidence is limited. Methods: In this small open-label clinical trial, 10 patients with CCH were included and maintained headache diaries for 10 weeks. Patients received three doses of peroral psilocybin (0.14 mg/kg) on the first day of weeks five, six, and seven. The first 4 weeks served as baseline and the last 4 weeks as follow-up. Hypothalamic FC was determined using functional magnetic resonance imaging the day before the first psilocybin dose and 1 week after the last dose. Results: The treatment was well tolerated. Attack frequency was reduced by mean (standard deviation) 31% (31) from baseline to follow-up (p_FWER = 0.008). One patient experienced 21 weeks of complete remission. Changes in hypothalamic–diencephalic FC correlated negatively with a percent change in attack frequency (p_FWER = 0.03, R = −0.81), implicating this neural pathway in treatment response. Conclusion: Our results indicate that psilocybin may have prophylactic potential and implicates the hypothalamus in possible treatment response. Further clinical studies are warranted.