The pore-forming toxin listeriolysin O (LLO) is a major virulence factor secreted by the facultative intracellular pathogen Listeria monocytogenes. This toxin facilitates L. monocytogenes intracellular survival in macrophages and diverse nonphagocytic cells by disrupting the internalization vesicle, releasing the bacterium into its replicative niche, the cytosol. Neutrophils are innate immune cells that play an important role in the control of infections, yet it was unknown if LLO could confer a survival advantage to L. monocytogenes in neutrophils. We report that LLO can enhance the phagocytic efficiency of human neutrophils and is unable to protect L. monocytogenes from intracellular killing. To explain the absence of L. monocytogenes survival in neutrophils, we hypothesized that neutrophil degranulation leads to the release of LLO-neutralizing molecules in the forming phagosome. In support of this, L. monocytogenes is a potent inducer of neutrophil degranulation, since its virulence factors, such as LLO, facilitate granule exocytosis. Within the first few minutes of interaction with L. monocytogenes, granules can fuse with the plasma membrane at the bacterial interaction site before closure of the phagosome. Furthermore, granule products directly degrade LLO, irreversibly inhibiting its activity. The matrix metalloproteinase-8, stored in secondary granules, was identified as an endoprotease that degrades LLO, and blocking neutrophil proteases increased L. monocytogenes intracellular survival. In conclusion, we propose that LLO degradation by matrix metalloproteinase-8 during phagocytosis protects neutrophil membranes from perforation and contributes to maintaining L. monocytogenes in a bactericidal phagosome from which it cannot escape.