While neutrophil activation during dengue virus (DV) infection is known, the effect of DV infection on neutrophil biogenesis has not been studied. We demonstrate that DV serotype-2 (DV2) induces the differentiation of mice progenitor cells ex vivo towards the CD11b + Ly6C + Ly6G+ granulocyte population. We further observed an expansion of CD11b + Ly6CintLy6Glow myeloid cells in the bone marrow of DV2-infected AG129 mice with low CXCR2 expression, implying immature population. Additionally, DV2 alone could induce the differentiation of promyelocyte cell line HL-60 into neutrophil-like cells (NLCs) as evidenced by increased expression of CD10, CD66b, CD16, CD11b, and CD62L, corroborating the preferential shift towards neutrophil differentiation by DV2 in the mouse model of dengue infection. The functional analysis showed that DV2-induced NLCs exhibited reduced phagocytic activity and enhanced NETosis as evidenced by the increased production of myeloperoxidase (MPO), citrullinated-Histones, extracellular DNA, and superoxide. These NLCs lose their ability to proliferate irreversibly and undergo arrest in the G0-G1 phase of the cell cycle. Further studies show that MPO-mediated signaling operating through the ROS axis may be involved in DV2-induced proliferation and differentiation of bone marrow cells as ABAH, an MPO inhibitor, limits cell proliferation in vitro and ex vi vo, affects the cell cycle, and reduces ROS production. Additionally, MPO inhibitor reduced NETosis and vascular leakage in DV2-infected AG129 mice. Our study thus provides evidence that DV2 can accelerate the differentiation of bone marrow progenitor cells into neutrophils through MPO and modulate their functions.