Luteolin, a plant flavonoid, has potent anti-inflammatory properties both in vitro and in vivo. However, the molecular mechanism of luteolin-mediated immune modulation has not been fully understood. In this study, we examined the effects of luteolin on the production of nitric oxide (NO) and prostaglandin E₂ (PGE₂), as well as the expression of inducible NO synthase (iNOS), cyclooxygenase-2 (COX-2), tumor necrosis factor-alpha (TNF-α), and interleukin-6 (IL-6) in mouse alveolar macrophage MH-S and peripheral macrophage RAW 264.7 cells. Luteolin dose-dependently inhibited the expression and production of these inflammatory genes and mediators in macrophages stimulated with lipopolysaccharide (LPS). Semi-quantitative reverse-transcription polymerase chain reaction (RT-PCR) assay further confirmed the suppression of LPS-induced TNF- α, IL-6, iNOS and COX-2 gene expression by luteolin at a transcriptional level. Luteolin also reduced the DNA binding activity of nuclear factor-kappa B (NF-κB) in LPS-activated macrophages. Moreover, luteolin blocked the degradation of IκB-α and nuclear translocation of NF-κB p65 subunit. In addition, luteolin significantly inhibited the LPS-induced DNA binding activity of activating protein-1 (AP-1). We also found that luteolin attenuated the LPS-mediated protein kinase B (Akt) and IKK phosphorylation, as well as reactive oxygen species (ROS) production. In sum, these data suggest that, by blocking NF-κB and AP-1 activation, luteolin acts to suppress the LPS-elicited inflammatory events in mouse alveolar macrophages, and this effect was mediated, at least in part, by inhibiting the generation of reactive oxygen species. Our observations suggest a possible therapeutic application of this agent for treating inflammatory disorders in lung.