Reactive oxygen species (ROS) produced by phagocytes are essential for host defence against bacterial and fungal infections. Individuals with defective ROS production machinery develop chronic granulomatous disease^,. Conversely, excessive ROS can cause collateral tissue damage during inflammatory processes and therefore needs to be tightly regulated. Here we describe a protein, we termed negative regulator of ROS (NRROS), which limits ROS generation by phagocytes during inflammatory responses. NRROS expression in phagocytes can be repressed by inflammatory signals. NRROS-deficient phagocytes produce increased ROS upon inflammatory challenges, and mice lacking NRROS in their phagocytes show enhanced bactericidal activity against Escherichia coli and Listeria monocytogenes. Conversely, these mice develop severe experimental autoimmune encephalomyelitis owing to oxidative tissue damage in the central nervous system. Mechanistically, NRROS is localized to the endoplasmic reticulum, where it directly interacts with nascent NOX2 (also known as gp91^phox and encoded by Cybb) monomer, one of the membrane-bound subunits of the NADPH oxidase complex, and facilitates the degradation of NOX2 through the endoplasmic-reticulum-associated degradation pathway. Thus, NRROS provides a hitherto undefined mechanism for regulating ROS prodution—one that enables phagocytes to produce higher amounts of ROS, if required to control invading pathogens, while minimizing unwanted collateral tissue damage.