Tumor‐associated macrophages (TAMs) support tumor progression within the tumor microenvironment (TME). Many questions remain as to the origin, development, and function of TAMs within the prostate TME. Evaluation of TAMs in prostate cancer (PCa) patients identified the immunosuppressive TAM marker CD163 in adjacent normal epithelium as an independent predictor of metastases or PCa death. Flow cytometry analyses identified prostate TAMs as frequently expressing both proinflammatory M1 (CCR7+) and immunosuppressive M2 (CD163+) markers. In vitro, we demonstrate PCa cells similarly subvert human M1 macrophages toward a mixed M1/M2 macrophage phenotype favoring tumor growth. Further the cytokine milieu‐induced transition between immunosuppressive M2 to proinflammatory M1 (M2→M1) macrophages is abrogated by the presence of PCa cells. RNA sequencing suggests alterations in chemokine expression in prostate TAMs due to the presence of PCa cells. Together, our results suggest that prostate TAMs originate from inflammatory infiltrating macrophages, which are then reprogrammed mainly by PCa cells, but also the cytokine milieu. A better understanding of this subversion of macrophages within the prostate may lead to novel treatment strategies. Our results demonstrate that mixed inflammatory and immunosuppressive macrophages found in the prostate develop because of prostate cancer contact. The presence of these macrophages in adjacent normal epithelium portends worse long‐term clinical outcomes for prostate cancer patients, highlighting the importance to develop effective strategies against their development.