Non-structural protein 1 (NS1) of dengue virus (DENV) harbours two conserved N-glycosylation sites at positions 130 and 207, whose biological roles have remained elusive. Using a clinically relevant mouse model of severe dengue, we showed that DENV that lacked N207 glycans on NS1 was significantly attenuated, and this phenotype was dominant over wildtype virulent DENV. Mice infected with this mutant exhibited accelerated viral clearance, milder lymphopenia and more functional DENV-specific CD8+ T cells. Bulk and single-cell RNA sequencing, cytokine measurements and immune-phenotyping revealed blunted innate inflammatory responses early post-infection, which correlated with reduced PD-L1 expression on innate immune cells and reduced PD-1+ T-cells in mice infected with de-glycosylated DENV. PD-1 blockade demonstrated the involvement of premature T-cell apoptosis through the PD-L1/PD-1 axis in DENV pathogenesis. Collectively our findings support that N207-deglycosylated NS1 inhibits early inflammatory responses, which restricts PD-L1 upregulation on innate immune cells, which in turn limits PD-L1/PD-1 mediated T-cell apoptosis. Our study uncovers a novel immune evasion strategy and identifies PD-L1/PD-1 as a novel mechanism of dengue immunopathogenesis.