Paradoxical tuberculosis-associated immune reconstitution inflammatory syndrome (TB-IRIS) is an aberrant inflammatory response occurring in a subset of TB-HIV co-infected patients initiating anti-retroviral therapy (ART). Here, we examined monocyte activation by prospectively quantitating pro-inflammatory plasma markers and monocyte subsets in TB-HIV co-infected patients from a South Indian cohort at baseline and following ART initiation at the time of IRIS, or at equivalent time points in non-IRIS controls. Pro-inflammatory biomarkers of innate and myeloid cell activation were increased in plasma of IRIS patients pre-ART and at the time of IRIS; this association was confirmed in a second cohort in South Africa. Increased expression of these markers correlated with elevated antigen load as measured by higher sputum culture grade and shorter duration of anti-TB therapy. Phenotypic analysis revealed the frequency of CD14(++)CD16(-) monocytes was an independent predictor of TB-IRIS, and was closely associated with plasma levels of CRP, TNF, IL-6 and tissue factor during IRIS. In addition, production of inflammatory cytokines by monocytes was higher in IRIS patients compared to controls pre-ART. These data point to a major role of mycobacterial antigen load and myeloid cell hyperactivation in the pathogenesis of TB-IRIS, and implicate monocytes and monocyte-derived cytokines as potential targets for TB-IRIS prevention or treatment.