Cryptococcosis is a potentially lethal disease that is primarily caused by the fungus Cryptococcus neoformans, treatment options for cryptococcosis are limited. Here, we show glucuronoxylomannan, the major polysaccharide component of C. neoformans, induces the recruitment of neutrophilic myeloid-derived suppressor cells in mice and patients with cryptococcosis. Depletion of neutrophilic myeloid-derived suppressor cells enhances host defense against C. neoformans infection. We identify C-type lectin receptor-2d recognizes glucuronoxylomannan to potentiate the immunosuppressive activity of neutrophilic myeloid-derived suppressor cells by initiating p38-mediated production of the enzyme arginase-1, which inhibits T-cell mediated antifungal responses. Notably, pharmacological inhibition of arginase-1 expression by a specific inhibitor of p38, SB202190, or an orally available receptor tyrosine kinase inhibitor, vandetanib, significantly enhances T-cell mediated antifungal responses against cryptococcosis. These data reveal a crucial suppressive role of neutrophilic myeloid-derived suppressor cells during cryptococcosis and highlight a promising immunotherapeutic application by inhibiting arginase-1 production to combat infectious diseases.