Differentiated cells possess a remarkable genomic plasticity that can be manipulated to reverse or change developmental commitments. Here, we show that the leprosy bacterium hijacks this property to reprogram adult Schwann cells, its preferred host niche, to a stage of progenitor/stem-like cells (pSLC) of mesenchymal trait by downregulating Schwann cell lineage/differentiation-associated genes and upregulating genes mostly of mesoderm development. Reprogramming accompanies epigenetic changes and renders infected cells highly plastic, migratory, and immunomodulatory. We provide evidence that acquisition of these properties by pSLC promotes bacterial spread by two distinct mechanisms: direct differentiation to mesenchymal tissues, including skeletal and smooth muscles, and formation of granuloma-like structures and subsequent release of bacteria-laden macrophages. These findings support a model of host cell reprogramming in which a bacterial pathogen uses the plasticity of its cellular niche for promoting dissemination of infection and provide an unexpected link between cellular reprogramming and host-pathogen interaction.