Quantum noises impose limits on both backaction cooling and displacement measurements in macroscopic resonators. Here, we demonstrate that for dissipative optomechanical systems in the deeply unresolved sideband regime, squeezed-vacuum engineering of Fano interference enables broadband, tunable suppression of backaction noise and complete evasion of backaction heating, along with destructive noise correlations in the measurement spectrum. This leads to ground-state cooling over a cavity-linewidth scale for both blue- and red-detuned drives, as well as substandard quantum limit position sensitivity both at and away from mechanical resonance. Our Letter establishes squeezed-reservoir engineering as a powerful platform for exploring nonclassical correlations, quantum sensing, and information processing via noise-interference control.

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• Optomechanics