Plants use pattern recognition receptors to defend themselves from microbial pathogens. These receptors recognize pathogen-associated molecular patterns (PAMPs) and activate signaling pathways that lead to immunity. In rice (Oryza sativa), the chitin elicitor binding protein (CEBiP) recognizes chitin oligosaccharides released from the cell walls of fungal pathogens. Here, we show that the rice blast fungus Magnaporthe oryzae overcomes this first line of plant defense by secreting an effector protein, Secreted LysM Protein1 (Slp1), during invasion of new rice cells. We demonstrate that Slp1 accumulates at the interface between the fungal cell wall and the rice plasma membrane, can bind to chitin, and is able to suppress chitin-induced plant immune responses, including generation of reactive oxygen species and plant defense gene expression. Furthermore, we show that Slp1 competes with CEBiP for binding of chitin oligosaccharides. Slp1 is required by M. oryzae for full virulence and exerts a significant effect on tissue invasion and disease lesion expansion. By contrast, gene silencing of CEBiP in rice allows M. oryzae to cause rice blast disease in the absence of Slp1. We propose that Slp1 sequesters chitin oligosaccharides to prevent PAMP-triggered immunity in rice, thereby facilitating rapid spread of the fungus within host tissue.