Isolinderalactone is the main sesquiterpene lactone isolated from Lindera aggregata, a traditional Chinese medicine widely used to treat pain and inflammation. Although isolinderalactone has been demonstrated to possess anti-cancer effect, its anti-inflammatory activity and underlying mechanism has not been well characterized. Herein, isolinderalactone was able to significantly inhibit the production of NO and PGE2 by reducing the expressions of iNOS and COX2 in LPS-stimulated RAW264.7 macrophages and BMDMs, and decreased the mRNA levels of IL-1β, IL-6, and TNF-α in LPS-induced RAW264.7 cells. In vivo, isolinderalactone effectively alleviated LPS-induced acute lung injury (ALI), which manifested as reduction in pulmonary inflammatory infiltration, myeloperoxidase activity, and production of PGE2, IL-1β, IL-6, TNF-α, and malondialdehyde. Furthermore, isolinderalactone inhibited phosphorylation of IKKα/β, phosphorylation and degradation of IκBα, and nuclear translocation of NF-κB p65, thereby blocking NF-κB pro-inflammatory pathway. Meanwhile, isolinderalactone reduced the intracellular ROS through promoting the activation of Nrf2-HMOX1 antioxidant axis. By using drug affinity responsive target stability assay and molecular docking, isolinderalactone was found to covalently interact with IKKα/β and Keap1, which may contribute to its anti-inflammatory action. Additionally, a thiol donor β-mercaptoethanol significantly abolished isolinderalactone-mediated anti-inflammatory action in vitro, indicating the crucial role of the unsaturated lactone of isolinderalactone on its anti-inflammatory effects. Taken together, isolinderalactone protected against LPS-induced ALI in mice, which may be associated with its inhibition of NF-κB pathway and activation of Nrf2 signaling in macrophages.