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We report on the effect of decoherence on polariton bistability. The polariton hysteresis loop is shown to collapse in a similar way when increasing the temperature or under nonresonant excitation power. The hysteresis upward threshold is pulled to lower excitation power, whereas the downward threshold remains almost constant. This effect is explained by the population of an incoherent reservoir that induces dephasing and repulsive interaction that saturates at large densities. All experimental findings are accurately simulated with the excitonic Bloch equations and indicate that reservoir-induced dephasing can be dominant over the reservoir-induced energy blueshift.