Neutrophil (PMN) infiltration of the intestinal mucosa often leads to severe epithelial injury, however how this process occurs is unclear. The current work describes a novel mechanism, whereby membrane derived microparticles released by tissue infiltrating PMNs (PMN-MPs) serve as shuttles to protect and deliver active mediators to locally modulate cellular function during inflammation. Specifically, myeloperoxidase (MPO), which is abundantly expressed in PMN azurophilic granules and used for microbial killing, was found to be mobilized to the PMN surface and subsequently released in association with PMN-MPs upon PMN activation and binding to intestinal epithelial cells (IECs). The enzymatic activity of PMN-MP-associated MPO was enhanced compared to soluble protein, leading to potent inhibition of wound closure following PMN-MP binding to IECs. Importantly, localized microinjection of PMN-MPs into wounded colonic mucosa was sufficient to impair epithelial wound healing in vivo. PMN-MPs/MPO-dependent inhibition of IEC wound healing was due to impaired IEC migration and proliferation, resulting from impeded actin dynamics, cell spreading, and cell cycle arrest. Thus, our findings provide new insight into mechanisms governing PMN-induced tissue injury, and implicate PMN-MPs and MPO as important regulators of cellular function.