Insect peptidoglycan recognition protein-S (PGRP-S), a member of a family of innate immunity pattern recognition molecules conserved from insects to mammals, recognizes bacterial cell wall peptidoglycan and activates 2 antimicrobial defense systems, prophenoloxidase cascade and antimicrobial peptides through Toll receptor. We show that mouse PGRP-S is present in neutrophil tertiary granules and that PGRP-S–deficient (PGRP-S^-/-) mice have increased susceptibility to intraperitoneal infection with gram-positive bacteria of low pathogenicity but not with more pathogenic gram-positive or gram-negative bacteria. PGRP-S^-/- mice have normal inflammatory responses and production of tumor necrosis factor α (TNF-α) and interleukin 6 (IL-6). Neutrophils from PGRP-S^-/- mice have normal phagocytic uptake of bacteria but are defective in intracellular killing and digestion of relatively nonpathogenic gram-positive bacteria. Therefore, mammalian PGRP-S functions in intracellular killing of bacteria. Thus, only bacterial recognition by PGRP-S, but not its effector function, is conserved from insects to mammals.