Staphylococcus aureus persistently colonises the anterior nares of a significant proportion of the healthy population, however the local immune response elicited during S. aureus nasal colonisation remains ill-defined. Local activation of IL-17/IL-22 producing T cells are critical for controlling bacterial clearance from the nasal cavity. However, recurrent and long-term colonisation is commonplace indicating efficient clearance does not invariably occur. Here we identify a central role for the regulatory cytokine IL-10 in facilitating bacterial persistence during S. aureus nasal colonisation in a murine model. IL-10 is produced rapidly within the nasal cavity following S. aureus colonisation, primarily by myeloid cells. Colonised IL-10^-/- mice demonstrate enhanced IL-17+ and IL-22+ T cell responses and more rapidly clear bacteria from the nasal tissues as compared with wild-type mice. S. aureus also induces the regulatory cytokine IL-27 within the nasal tissue, which acts upstream of IL-10 promoting its production. IL-27 blockade reduces IL-10 production within the nasal cavity and improves bacterial clearance. TLR2 signalling was confirmed to be central to controlling the IL-10 response. Our findings conclude that during nasal colonisation S. aureus creates an immunosuppressive microenvironment through the local induction of IL-27 and IL-10, to dampen protective T cell responses and facilitate its persistence.