The cellular stress response has a vital role in regulating homeostasis by modulating cell survival and death. Stress granules are cytoplasmic compartments that enable cells to survive various stressors. Defects in the assembly and disassembly of stress granules are linked to neurodegenerative diseases, aberrant antiviral responses and cancer1,2,3,4,5. Inflammasomes are multi-protein heteromeric complexes that sense molecular patterns that are associated with damage or intracellular pathogens, and assemble into cytosolic compartments known as ASC specks to facilitate the activation of caspase-1. Activation of inflammasomes induces the secretion of interleukin (IL)-1β and IL-18 and drives cell fate towards pyroptosis—a form of programmed inflammatory cell death that has major roles in health and disease6,7,8,9,10,11,12. Although both stress granules and inflammasomes can be triggered by the sensing of cellular stress, they drive contrasting cell-fate decisions. The crosstalk between stress granules and inflammasomes and how this informs cell fate has not been well-studied. Here we show that the induction of stress granules specifically inhibits NLRP3 inflammasome activation, ASC speck formation and pyroptosis. The stress granule protein DDX3X interacts with NLRP3 to drive inflammasome activation. Assembly of stress granules leads to the sequestration of DDX3X, and thereby the inhibition of NLRP3 inflammasome activation. Stress granules and the NLRP3 inflammasome compete for DDX3X molecules to coordinate the activation of innate responses and subsequent cell-fate decisions under stress conditions. Induction of stress granules or loss of DDX3X in the myeloid compartment leads to a decrease in the production of inflammasome-dependent cytokines in vivo. Our findings suggest that macrophages use the availability of DDX3X to interpret stress signals and choose between pro-survival stress granules and pyroptotic ASC specks. Together, our data demonstrate the role of DDX3X in driving NLRP3 inflammasome and stress granule assembly, and suggest a rheostat-like mechanistic paradigm for regulating live-or-die cell-fate decisions under stress conditions.