Methicillin-resistant Staphylococcus aureus (MRSA) causes invasive, drug-resistant skin and soft tissue infections. Reports that S. aureus bacteria survive inside macrophages suggest that the intramacrophage environment may be a niche for persistent infection; however, mechanisms by which the bacteria might evade macrophage phagosomal defenses are unclear. We examined the fate of the S. aureus-containing phagosome in THP-1 macrophages by evaluating bacterial intracellular survival and phagosomal acidification and maturation and by testing the impact of phagosomal conditions on bacterial viability. Multiple strains of S. aureus survived inside macrophages, and in studies using the MRSA USA300 clone, the USA300-containing phagosome acidified rapidly and acquired the late endosome and lysosome protein LAMP1. However, fewer phagosomes containing live USA300 bacteria than those containing dead bacteria associated with the lysosomal hydrolases cathepsin D and β-glucuronidase. Inhibiting lysosomal hydrolase activity had no impact on intracellular survival of USA300 or other S. aureus strains, suggesting that S. aureus perturbs acquisition of lysosomal enzymes. We examined the impact of acidification on S. aureus intramacrophage viability and found that inhibitors of phagosomal acidification significantly impaired USA300 intracellular survival. Inhibition of macrophage phagosomal acidification resulted in a 30-fold reduction in USA300 expression of the staphylococcal virulence regulator agr but had little effect on expression of sarA, saeR, or sigB. Bacterial exposure to acidic pH in vitro increased agr expression. Together, these results suggest that S. aureus survives inside macrophages by perturbing normal phagolysosome formation and that USA300 may sense phagosomal conditions and upregulate expression of a key virulence regulator that enables its intracellular survival.