Polymicrobial sepsis induces organ failure and is accompanied by overwhelming inflammatory response and impairment of microbial killing. Peroxisome proliferator-activated receptor-gamma (PPAR-γ) is a nuclear receptor with pleiotropic effects on lipid metabolism, inflammation, and cell proliferation. The insulin-sensitizing drugs thiazolidinediones (TZDs) are specific PPAR-γ agonists. TZDs exert anti-inflammatory actions in different disease models, including polymicrobial sepsis. The TZD pioglitazone, which is an FDA-approved drug, improves sepsis outcome; however, the molecular programs that mediate the effect of pioglitazone have not been determined. In a murine model of sepsis, we now show that pioglitazone treatment acts to improve microbial clearance and to enhance neutrophil recruitment to the site of infection. We also observed reduced pro-inflammatory cytokine production and high IL-10 levels in pioglitazone-treated mice. These effects were associated with a decrease in STAT-1-dependent expression of myeloid differentiation factor-88 (MyD88) in vivo and in vitro. IL-10R blockage abolished PPAR-γ-mediated inhibition of MyD88 expression. These data demonstrate that the primary mechanism by which pioglitazone protects against polymicrobial sepsis is by impairing MyD88 responses. This appears to represent a novel regulatory program. In this regard, pioglitazone provides advantages as a therapeutic tool, since it improves different aspects of host defense during sepsis, ultimately enhancing survival.