Acute myeloid leukemia (AML) is a heterogeneous hematologic disorder characterized by expansion of myeloid blasts. Despite its immunoresponsive nature a growing number of im-munoevasive phenomena is reported thus preventing efficient elimination of aberrant cells. In this context myeloid-derived suppressor cells (MDSCs) have emerged as an important medi-ator of tumor-associated immune suppression. MDSCs are of myeloid origin, possess im-mune regulatory properties, and accumulate in various malignant entities including AML. Monocytic CD14+ cells with low levels of surface HLA-DR (CD14+HLA-DRlo) represent the most prominent MDSC subset in cancer patients and are abundant in newly diagnosed AML patients. Mechanisms promoting the expansion of MDSCs, control their bioenergetic profile, and suppressive features have not been fully elucidated in AML. Here, we demonstrate that CD14+HLA-DRlo MDSCs accumulate in AML patients. Coculture of the AML cell lines or AML blasts with conventional CD14+ monocytes elicited induction of MDSCs with an enhanced indoleamine-2,3-dioxygenase (IDO) expression, T-cell-suppressive properties, and reduced HLA-DR levels. The observed MDSC reprogramming was cell contact-independent. In fact, we identified AML-derived exosomes as the underlying trigger. We show that AML-exosomes are taken up by monocytes leading to an HLA-DRlo phenotype, an increased IDO expression, and T-cell inhibitory properties. In addition, we describe that AML-derived exosomes mediate in monocytes a bioenergetic switch away from oxidative phosphorylation towards aerobic glycolysis rendering them more susceptible to glycolytic inhibitors. Toll-like receptor 2 (TLR2) was identified as the critical driver of AML-exosome-mediated MDSC induction. TLR2 activation triggered an akt/mTOR/CREB axis while interfering with mTOR signaling, prevented induction of an MDSC phenotype and sup-pressive function. Removal of the surface proteins on exosomes abolished TLR2 activation, and preceding inhibition of palmitoylation in the parental AML cells via 2-Bromopalmitate (2-BP) efficiently diminished exosome-mediated TLR2 activation and subsequent MDSC gener-ation. Overall, AML-derived exosomes carry palmitoylated surface proteins, which trigger repro-gramming of monocytes into glycolytic MDSCs in a TLR2-dependent manner. Using specific inhibitors (2-DG or rapamycin), targeting the process of protein palmitoylation in AML (2-BP), interfering with exosome-monocyte interaction with TLR2-blocking antibodies, and inhibiting AKT/mTOR/CREB activity in monocytes might represent promising approaches to prevent exosome-mediated MDSC induction and could thereby pave the way for improved responses to immunotherapies in AML.