The outcomes of Leishmania infection are determined by host immune and nutrition status, parasite species, and co-infection with other pathogens. While subclinical infection and self-healing cutaneous leishmaniasis (CL) are common, uncontrolled parasite replication can lead to non-healing local lesions or visceral leishmaniasis (VL). It is known that infection control requires Th1-differentiation cytokines (IL-12, IL-18, and IL-27) and Th1 cell and macrophage activation. However, there is no generalized consensus for the mechanisms of host susceptibility. The recent studies on regulatory T cells and IL-17-producing cells help explain the effector T cell responses that occur independently of the known Th1/Th2 cell signaling pathways. This review focuses on the immunopathogenesis of non-healing American CL and progressive VL. We summarize recent evidence from human and animal studies that reveals the mechanisms of dysregulated, hyper-responses to Leishmania braziliensis, as well as the presence of disease-promoting or the absence of protective responses to Leishmania amazonensis and Leishmania donovani. We highlight immune-mediated parasite growth and immunopathogenesis, with an emphasis on the putative roles of IL-17 and its related cytokines as well as arginase. A better understanding of the quality and regulation of innate immunity and T cell responses triggered by Leishmania will aid in the rational control of pathology and the infection.