Background and Objectives: Elevated levels of saturated fatty acids (SFA) induce a state of neuroinflammation in the hypothalamus. It has been suggested that microglia sense palmitate, a prevalent circulating SFA, and act as mediators of this inflammatory process by communicating with neurons, particularly those involved in appetite regulation. In this study, we examined the inflammatory response to palmitate in immortalized microglial cell lines, BV-2 and IMG, and the subsequent effects on inflammatory gene expression in a model of NPY/AgRP neurons, mHypoE-46. Methods: The BV-2 cells were treated with 50 µM palmitate for 4 and 24 h, and the transcriptional regulation of markers for inflammation and cellular stress was assessed using an RT<sup>2</sup> Profiler PCR Array. Select genes were verified with qRT-PCR. The BV-2 and IMG cells were then co-cultured using 1.0-µm cell culture inserts with an immortalized hypothalamic cell line, mHypoE-46, to investigate potential intercellular communication between microglia and neurons. Results: We found that palmitate increased the mRNA levels of specific inflammatory genes, and a general anti-inflammatory profile was revealed in the microglia cells. The mRNA changes in TNFα at 4 and 24 h in BV-2 cells were abrogated with the toll-like receptor 4 (TLR4) inhibitor, TAK-242, indicating the involvement of TLR4. Co-culture of mHypoE-46 neurons with microglia pre-treated with palmitate resulted in repression of TNFα expression in the hypothalamic neurons. As palmitate significantly increased IL-13 expression in microglia, the effect of this cytokine was tested in mHypoE-46 neurons. The addition of IL-13 to neuronal cultures normalized the palmitate-mediated increase in IL-6 and AgRP expression, suggesting that microglia may protect surrounding neurons, at least in part, through the release of IL-13. Conclusions: These results suggest a potential anti-inflammatory role of microglia towards the palmitate-induced neuroinflammation, and potentially energy homeostasis, in hypothalamic neurons.