This chapter focuses on the dynamic interaction of Cryptococcus neoformans with alveolar macrophages (AMs) and how the consequential actions of both the host and fungal pathogen can affect the outcome of C. neoformans exposure. In macrophages, glucuronoxylomannan (GXM) binding to Toll-like receptors 2 (TLR2) and TLR4, in conjunction with CD14, triggers NF κB activation and its translocation to the nucleus. Recognition and binding of C. neoformans by phagocytes occurs with greater avidity when cells are opsonized. The alveolar spaces of the lung are coated with an epithelial lining fluid containing components essential to the induction of the host immune response, including complement and immunoglobulins (Ig). Administration of mAbs against GXM can increase C. neoformans internalization and prolong survival in murine models of cryptococcosis via complement pathway-independent and/or -dependent mechanisms. In neutrophils, GXM is rapidly degraded, but in rat macrophages, GXM can persist for months. Thus, the role of GXM in the regulation of the host immune response through macrophages is clearly more complex than that occurring through neutrophils. C. neoformans has developed mechanisms to survive within the phagolysosome. The enlargement of the polysaccharide capsule following phagocytosis provides resistance to microbicidal agents within the lumen of the phagolysosome, such as reactive oxygen species and antimicrobial peptides. The majority of research attempting to reveal novel C. neoformans virulence attributes mostly produces new mechanisms by which the three archetypal virulence factors modulate pathogenesis.