The reduced efficiency of the mammalian immune system with aging increases host susceptibility to infectious and autoimmune diseases. However, the mechanisms responsible for these pathologic changes are not well understood. In this study, we demonstrate that the bone marrow, blood, and secondary lymphoid organs of healthy aged mice possess increased numbers of immature myeloid cells that are phenotypically similar to myeloid-derived suppressor cells found in lymphoid organs of mice with progressive tumors and other pathologic conditions associated with chronic inflammation. These cells are characterized by the presence of Gr1 and CD11b markers on their surfaces. Gr1(+)CD11b(+) cells isolated from aged mice possess an ability to suppress T cell proliferation/activation and produce heightened levels of proinflammatory cytokines, both constitutively and upon activation, including IL-12, which promotes an excessive production of IFN-γ. IFN-γ priming is essential for excessive proinflammatory cytokine production and the suppressive activities by Gr1(+)CD11b(+) cells from aged mice. These cells suppress T cell proliferation through an NO-dependent mechanism, as depletion of splenic Gr1(+) cells reduces NO levels and restores T cell proliferation. Insights into mechanisms responsible for the proinflammatory and immune suppressive activities of Gr1(+)CD11b(+) cells from aged mice have uncovered a defective PI3K-Akt signaling pathway, leading to a reduced Akt-dependent inactivation of GSK3β. Our data demonstrate that abnormal activities of the Gr1(+)CD11b(+) myeloid cell population from aged mice could play a significant role in the mechanisms responsible for immune senescence.