Candida albicans is the most common cause of human fungal infection, but the mechanisms of invasive pathogenesis remain poorly defined. Here we identify an unexpected mechanism: lipid-mediated immunosuppression. Through forward genetics, we found that C. albicans secretes a lipase, Lip2, that is critical for invasive disease. Murine infection with C. albicans strains that lack Lip2 display an exaggerated host IL-17 response that leads to fungal clearance from solid organs and host survival. IL-17 signaling is required for Lip2 action. The lipase activity of Lip2 inhibits IL-17 production indirectly through suppression of IL-23 production by tissue resident dendritic cells. We conclude that C. albicans suppresses antifungal IL-17 defense in solid organs by altering the tissue lipid milieu.