Commensal and pathogenic bacteria hydrolyze host lipid substrates with secreted lipases and phospholipases for nutrient acquisition, colonization, and infection. Bacterial lipase activity on mammalian lipids and phospholipids can promote release of free fatty acids from lipid stores, detoxify antimicrobial lipids, and facilitate membrane dissolution. The gram-positive bacterium Staphylococcus aureus secretes at least two lipases, Sal1 and glycerol ester hydrolase (Geh), with specificities for short- and long-chain fatty acids, respectively, each with roles in the hydrolysis of environmental lipids. In a recent study from our group, we made the unexpected observation that Geh released by S. aureus inhibits activation of innate immune cells. Herein, we investigated the possibility that S. aureus lipases interface with the host immune system to blunt innate immune recognition of the microbe. We found that the Geh lipase, but not other S. aureus lipases, prevents activation of innate cells in culture. Mutation of geh leads to enhancement of proinflammatory cytokine production during infection, increased innate immune activity, and improved clearance of the bacterium in infected tissue. These in vitro and in vivo effects on innate immunity were not due to direct functions of the lipase on mammalian cells, but rather a result of inactivation of S. aureus lipoproteins, a major pathogen-associated molecular pattern (PAMP) of extracellular gram-positive bacteria, via ester hydrolysis. Altogether, these studies provide insight into an adaptive trait that masks microbial recognition by innate immune cells through targeted inactivation of a broadly conserved PAMP.