T cell suppression contributes to immune dysfunction in sepsis. However, the underlying mechanisms are not well-defined. Here, we show that exposure of human peripheral blood mononuclear cells to bacterial lipopolysaccharide (LPS) can rapidly and dose-dependently suppress interleukin-2 (IL-2) production and T cell proliferation. We also report that these effects depend on monocytes. LPS did not prevent the interaction of monocytes with T cells, nor did it induce programmed cell death protein 1 (PD-1) signaling that causes T cell suppression. Instead, we found that LPS stimulation of monocytes led to the accumulation of extracellular ATP that impaired mitochondrial function, cell migration, IL-2 production, and T cell proliferation. Mechanistically, LPS-induced ATP accumulation exerted these suppressive effects on T cells by activating the purinergic receptor P2Y11 on the cell surface of T cells. T cell functions could be partially restored by enzymatic removal of extracellular ATP or pharmacological blocking of P2Y11 receptors. Plasma samples obtained from sepsis patients had similar suppressive effects on T cells from healthy subjects. Our findings suggest that LPS and ATP accumulation in the circulation of sepsis patients suppresses T cells by promoting inappropriate P2Y11 receptor stimulation that impairs T cell metabolism and functions. We conclude that inhibition of LPS-induced ATP release, removal of excessive extracellular ATP, or P2Y11 receptor antagonists may be potential therapeutic strategies to prevent T cell suppression and restore host immune function in sepsis.