The Esx-1 (type VII) secretion system is a major virulence determinant of pathogenic mycobacteria, including Mycobacterium marinum. However, the molecular events and host-pathogen interactions underlying Esx-1-mediated virulence in vivo remain unclear. Here we address this problem in a non-lethal mouse model of M. marinum infection that allows detailed quantitative analysis of disease progression. M. marinum established local infection in mouse tails, with Esx-1-dependent formation of caseating granulomas similar to those formed in human tuberculosis, and bone deterioration reminiscent of skeletal tuberculosis. Analysis of tails infected with wild type or Esx-1-deficient bacteria showed that Esx-1 enhanced generation of proinflammatory cytokines, including the secreted form of IL-1beta, suggesting that Esx-1 promotes inflammasome activation in vivo. In vitro experiments indicated that Esx-1-dependent inflammasome activation required the host NLRP3 and ASC proteins. Infection of wild type and ASC-deficient mice demonstrated that Esx-1-dependent inflammasome activation exacerbated disease without restricting bacterial growth, indicating a host-detrimental role of this inflammatory pathway in mycobacterial infection. These findings define an immunoregulatory role for Esx-1 in a specific host-pathogen interaction in vivo, and indicate that the Esx-1 secretion system promotes disease and inflammation through its ability to activate the inflammasome.