Prdx6 is a multi-functional enzyme that expresses peroxidase, phospholipase A2 (PLA2) and LPC acyltransferase activities. While the three activities of Prdx6 contribute to either the scavenging of lipid hydroperoxides or to the repair of peroxidized membranes, the PLA2 activity of Prdx6 (aiPLA2) is also required for Nox2 activation in pulmonary microvascular cells (PMVECs), alveolar macrophages and polymorphonuclear neutrophils. During sepsis-induced acute lung injury (ALI), Nox2 generates superoxide radicals that contribute to vascular inflammation. To test whether inactivation of aiPLA2 ameliorates sepsis-induced ALI, we used a knock-in mouse model that lacks aiPLA2 activity due to a mutation of a key member of the aiPLA2 catalytic triad (Prdx6-D140A). Prdx6-D140A mice treated IP with LPS exhibited increased survival rates compared to WT mice. Total nucleated cells in BALF, MPO activity, BALF cytokine expression, lung VCAM-1 expression, lung PMN infiltration, lung nitrotyrosine levels and lung permeability increased significantly after 24 h treatment with LPS in WT but not in Prdx6-D140A mice. In PMVECs, LPS treatment increased Prdx6 phosphorylation and aiPLA2 activity by two-fold. Furthermore, phosphorylated Prdx6 was localized at the plasma membrane after LPS treatment. LPS also increased H2O2 generation, lipid peroxidation, protein nitration, NfkB nuclear localization and NLRP3:ASC inflammasome assembly in WT but not in Nox2 null or Prdx6-D140A PMVECs. Similarly, LPS increased intracellular H2O2 generation in WT PMVECs stably-expressing the pHyPer-Cyto sensor but not in cells pre-treated with MJ33, a pharmacological inhibitor of aiPLA2. These results demonstrate that aiPLA2 is needed for LPS-induced, Nox2-driven oxidant generation in PMVECs. Results also show that genetic inactivation of aiPLA2 reduces mortality, lung inflammation and oxidative stress in an animal model of sterile sepsis. Furthermore, these studies suggest that aiPLA2 could be a target for prevention or treatment of sepsis-induced ALI.