Protein-tyrosine phosphatase-1B (PTP1B) negatively regulates insulin and leptin signalling, rendering it an attractive drug target for treatment of obesity-induced insulin resistance. However, some studies suggest caution when targeting macrophage-PTP1B, due to its potential anti-inflammatory role. We assessed the role of macrophage-PTP1B in inflammation and whole body metabolism using myeloid-cell (LysM)-PTP1B-knockout mice (LysM-PTP1B). LysM-PTP1B mice were protected against LPS-induced endotoxemia and hepatic damage, associated with decreased pro-inflammatory cytokine secretion in vivo. In vitro, LPS-treated LysM-PTP1B bone-marrow-derived-macrophages (BMDMs) displayed increased IL10 mRNA expression, with a concomitant decrease in TNFα mRNA levels. These anti-inflammatory effects were associated with increased LPS- and IL10-induced STAT3 phosphorylation in LysM-PTP1B BMDMs. Chronic inflammation induced by high-fat (HF)-feeding led to equally beneficial effects of macrophage-PTP1B deficiency; LysM-PTP1B mice exhibited improved glucose- and insulin tolerance, protection against LPS-induced hyperinsulinemia, decreased macrophage infiltration into adipose tissue and decreased liver damage. HF-fed LysM-PTP1B mice had increased basal and LPS-induced IL10 levels, associated with elevated splenic STAT3 phosphorylation, IL10 mRNA expression, and expansion of cells expressing myeloid markers. These increased IL10 levels negatively correlated with circulating insulin and ALT levels. Our studies implicate myeloid-PTP1B in negative regulation of STAT3/IL10-mediated signalling, highlighting its inhibition as a potential anti-inflammatory and anti-diabetic target in obesity.