The multibasic furin cleavage site at the S1/S2 boundary of the spike protein (S protein) is a hallmark of SARS-CoV-2 and is essential for its increased infectivity. O-glycosylation near the furin site catalyzed by host cell glycosyltransferases can theoretically hinder spike protein processing and impede viral infection, but so far such hypothesis has not been tested with authentic viruses. The mechanism for furin activation is not clearly understood either. Here in this study, we discovered that GalNAc-T3 and T7 together initiate clustered O-glycosylations in the multibasic S1/S2 boundary region, which inhibits furin processing of the spike protein and surprisingly suppresses the incorporation of S protein into virus-like-particles (VLPs). Mechanistic analysis revealed that the assembly of spike protein into VLPs relies on protein-protein interaction between the furin-cleaved S protein and a double aspartic motif on the membrane protein of SARS-CoV-2, suggesting a novel mechanism for furin activation of S protein. Interestingly, a point mutation at P681, found in the SARS-CoV-2 variants alpha and delta, resists the glycosylation by GalNAc-T3 and T7 and its inhibitory effect against furin processing. However, an additional mutation at N679 in the most recent omicron variant reverts this resistance, making it both prone to glycosylation in vitro and sensitive to the expression of GalNAc-T3 and T7 in human lung cells. Together, our results suggest a glycosylation-based defense mechanism of host cells against SARS-CoV-2 and reveal the host-pathogen interplay at this critical “battle field” as the virus first escapes and currently surrenders itself to the host cell glycosylation.