Non-typeable Haemophilus influenzae (NTHi) is commonly associated with chronic suppurative lung disease in children. We have previously shown that children with chronic suppurative lung disease have a reduced capacity to produce IFN-γ in response to NTHi compared with healthy control children. The aim of this study was to determine if deficient NTHi-specific IFN-γ production is associated with heightened systemic or airway inflammation. We measured a panel of cytokines (IFN-γ, IL-1β, IL-6, IL-8, IL-12 p70), antimicrobial proteins (LL-37, IP-10) as well as cellular and clinical factors associated with airway and systemic inflammation in 70 children with chronic suppurative lung disease. IFN-γ was measured in peripheral blood mononuclear cells challenged in vitro with live NTHi. Regression analysis was used to assess the association between the systemic and airway inflammation and the capacity to produce IFN-γ. On multivariate regression, NTHi-specific IFN-γ production was significantly negatively associated with the BAL concentrations of the inflammatory cytokines IL-6 (β=-0.316; 95%CI -0.49, -0.14; p=0.001) and IL-1β (β=-0.023; 95%CI -0.04, -0.01; p=0.001). This association was independent of bacterial or viral infection, BAL cellularity and the severity of bronchiectasis (using modified Bhalla score on chest CT scans). We found limited evidence of systemic inflammation in children with chronic suppurative lung disease. In summary, increased local airway inflammation is associated with a poorer systemic cell-mediated immune response to NTHi in children with chronic suppurative lung disease. These data support the emerging body of evidence that impaired cell-mediated immune responses and dysregulated airway inflammation may be linked and contribute to the pathobiology of chronic suppurative lung disease.