Mer receptor tyrosine kinase (Mer) signaling plays a central role in the intrinsic inhibition of the inflammatory response to Toll-like receptor activation. Previously, we found that lung Mer protein expression decreased after lipopolysaccharide (LPS) treatment due to enhanced Mer cleavage. The purpose of the present study was to examine whether pharmacologically restored membrane-bound Mer expression upregulates the Mer signaling pathways and suppresses lung inflammatory responses. Pretreatment with the ADAM17 (a disintegrin and metalloproteinase-17) inhibitor TAPI-0 (tumor necrosis factor alpha protease inhibitor-0) reduced LPS-induced production of soluble Mer protein in bronchoalveolar lavage (BAL) fluid, restored membrane-bound Mer expression, and increased Mer activation in alveolar macrophages and lungs after LPS treatment. TAPI-0 also enhanced Mer downstream signaling, including phosphorylation of protein kinase b, focal adhesion kinase, and signal transducer and activator of transcription 1. As expected from enhanced Mer signaling, TAPI-0 also augmented suppressor of cytokine signaling-1 and -3 mRNA and protein levels and inhibited nuclear factor κB activation at 4 and 24 hours after LPS treatment. TAPI-0 suppressed LPS-induced inflammatory cell accumulation, total protein level elevation in BAL fluid, and production of inflammatory mediators, including tumor necrosis factor-α, interleukin-1β, and macrophage inflammatory protein-2. Additionally, the effects of TAPI-0 on the activation of Mer signaling and the production of inflammatory responses could be reversed by cotreatment with specific Mer-neutralizing antibody. Restored Mer protein expression by treatment with TAPI-0 efficiently prevents the inflammatory cascade during acute lung injury.