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Failed host defense against intracellular Leishmania in absence of SLPI involves imbalance of Th1/Th2 cytokines and M1/M2 polarization linked to dysregulation of SOCS1 and IL‐27. SLPI, a potent epithelial and myeloid‐derived serine protease inhibitor with antimicrobial and anti‐inflammatory functions, is induced by the intracellular parasite Leishmania major, and increased SLPI expression is evident within lesions that follow L. majorinfection. In contrast to self‐resolving infection in C57Bl/6 WT mice, Slpi−/−mice launch a strong Th1 response to L. major, yet fail to control infection and develop destructive, nonhealing lesions with systemic spread of parasites. Because SLPI is both produced by murine macrophages and antagonizes their function, we examined the contribution of macrophage polarization to the defective host response in the absence of SLPI. Slpi−/−and Slpi+/+macrophages were first primed with either IFNγ or IL‐4 to generate classically activated M1 or alternatively activated M2 macrophages. After infection with L. major, Slpi−/−M1 macrophages expressed elevated iNOS RNA, whereas arginase was more highly expressed in WT than Slpi−/−M2 macrophages. After in vivo infection, we found that both IFNγ and iNOS were persistently overexpressed in chronic lesions in Slpi−/−mice, but surprisingly, IL‐4 and arginase concomitantly remained elevated. Moreover, overexpression of the negative regulators SOCS1 and IL‐27 provided insight into the failure of IFNγ to clear L. majorfrom the dermal lesions. Notably, adenoviral delivery of SLPI to L. major‐infected Slpi−/−mice significantly limited the progression of infection. These studies suggest that convergence of M1 and M2 macrophage responses may influence the outcome of innate host defense against intracellular parasites and that SLPI is critical for coordinating resistance to chronic leishmaniasis.