To understand how the interaction between an intracellular bacterium and the host immune system contributes to outcome at the site of infection, we studied leprosy, a disease that forms a clinical spectrum, in which progressive infection by the intracellular bacterium Mycobacterium leprae is characterized by the production of type I IFNs and antibody production.We performed dual RNAseq on patient lesions, identifying a continuum of distinct bacterial states that are linked to the host immune response. The bacterial burden, represented by the fraction of bacterial transcripts, correlates with a host type I IFN gene signature, known to inhibit antimicrobial responses. Second, the bacterial transcriptional activity, defined by the bacterial mRNA/rRNA ratio, links bacterial heat shock proteins with the BAFF-BCMA host antibody response pathway. Our findings provide a platform for interrogation of host and pathogen transcriptomes at the site of infection, allowing insight into mechanisms of inflammation in human disease.