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Myeloid differentiation factor 2 (MD2), the TLR4 coreceptor, has been shown to possess opsonic activity and has been implicated in phagocytosis and intracellular killing of Gram-negative bacteria. However, any MD2 protein segment involved in phagocytosis of Gram-negative bacteria is not yet known. A short synthetic MD2 segment, MD54 (amino acid regions 54 to 69), was shown to interact with a Gram-negative bacterial outer membrane component, LPS, earlier. Furthermore, the MD54 peptide induced aggregation of LPS and facilitated its internalization in THP-1 cells. Currently, it has been investigated if MD2-derived MD54 possesses any opsonic property and role in phagocytosis of Gram-negative bacteria. Remarkably, we observed that MD54 facilitated agglutination of Gram-negative bacteria, Escherichia coli (ATCC 25922) and Pseudomonas aeruginosa (ATCC BAA-427), but not of Gram-positive bacteria, Bacillus subtilis (ATCC 6633) and Staphylococcus aureus (ATCC 25923). The MD54-opsonized Gram-negative bacteria internalized within PMA-treated THP-1 cells and were killed over a longer incubation period. However, both internalization and intracellular killing of the MD54-opsonized Gram-negative bacteria within THP-1 phagocytes were appreciably inhibited in the presence of a phagocytosis inhibitor, cytochalasin D. Furthermore, MD54 facilitated the clearance of Gram-negative bacteria E. coli (ATCC 25922) and P. aeruginosa (ATCC BAA-427) from the infected BALB/c mice whereas an MD54 analog, MMD54, was inactive. Overall, for the first time, the results revealed that a short MD2-derived peptide can specifically agglutinate Gram-negative bacteria, act as an opsonin for these bacteria, and facilitate their phagocytosis by THP-1 phagocytes. The results suggest that the MD54 segment could have a crucial role in MD2-mediated host-pathogen interaction involving the Gram-negative bacteria.