Human monocytes differentiate into either proinflammatory or immunosuppressive macrophages in response to distinct stimuli. Results show that the Toll-like receptor 2/1 agonist PAM3 replicates the ability of macrophage colony-stimulating factor (M-CSF) to induce the preferential generation of immunosuppressive macrophages in vitro, an activity confirmed by in vivo studies of rhesus macaques. By comparing the gene expression pattern of monocytes treated with M-CSF vs PAM3, the pathways regulating macrophage maturation were identified. NF-κB and Akt were found to play a central role in the overall process of monocyte into macrophage differentiation. Pathways regulated by p38 MAPK and PTGS2 biased this process toward the generation of immunosuppressive rather than proinflammatory macrophages. ERK and JNK contribute to PAM3- but not M-CSF-driven monocyte maturation. These findings clarify the mechanisms underlying the generation of immunosuppressive macrophages and support the use of PAM3 in the treatment of autoimmune and inflammatory diseases.