Acute myeloid leukemia (AML) represents the most common acute leukemia among adults. Despite recent progress in diagnosis and treatment, long-term outcome remains unsatisfactory. The success of allogeneic stem cell transplantation underscores the immunoresponsive nature of AML, creating the basis for further exploiting immunotherapies. However, emerging evidence suggests that AML, similar to other malignant entities, employs a variety of mechanisms to evade immunosurveillance. In light of this, T-cell inhibitory myeloid-derived suppressor cells (MDSC) are gaining interest as key facilitators of immunoescape. Accumulation of CD14 HLA-DR monocytic MDSCs has been described in newly diagnosed AML patients, and deciphering the underlying mechanisms could help to improve anti-AML immunity. Here, we report that conventional monocytes readily take-up AML-derived extracellular vesicles (EV) and subsequently undergo MDSC differentiation. They acquired an CD14 HLA-DR phenotype, expressed the immunomodulatory indoleamine-2,3-dioxygenase, and upregulated expression of genes characteristic for MDSCs, such as and . The Akt/mTOR pathway played a critical role in the AML-EV-induced phenotypical and functional transition of monocytes. Generated MDSCs displayed a glycolytic switch, which rendered them more susceptible toward glycolytic inhibitors. Furthermore, palmitoylated proteins on the AML-EV surface activated Toll-like receptor 2 as the initiating event of Akt/mTOR-dependent induction of MDSC. Therefore, targeting protein palmitoylation in AML blasts could block MDSC accumulation to improve immune responses. SIGNIFICANCE: These findings indicate that targeting protein palmitoylation in AML could interfere with the leukemogenic potential and block MDSC accumulation to improve immunity.