The present study explored the natural compound Isotelekin isolated from Inula racemose against anti-inflammatory and immunomodulatory potential in LPS-induced RAW264.7 cell lines and immune-elevated SRBC-sensitized animal models. Isotelekin in in vitro studies, inhibited the production of Th-1 cytokines Interleukin-6 (IL-6), Tumour necrosis factor (TNF-α), and Interferon-gamma (INF-γ),and increased Th-2 cytokines Interleukin-10 (IL-10). Whereas it inhibited the nitrites and reactive oxygen species (ROS) production by mitigating the effect of LPS significantly. In vivo immunomodulatory activity in Delayed-type hypersensitivity (DTH) and Hemagglutinating antibody (HA), Isotelekin suppressed the cellular as well as humoral immunity in immune-affected and SRBC-sensitized mice. Isotelekin decreased the phagocytic responses against carbon particles and plaque-forming mainly IgG (Immunoglobulin G) production. Additionally, Isotelekin showed immunosuppressive potential through the evaluation of splenocytes, allograft acceptance, and haematological parameters. Molecular studies, including western blot analysis and immunocytochemistry, revealed that Isotelekin reduced the expression of iNOS (Inducible nitric oxide synthase), COX-2 (Cyclo-Oxygenase 2), and p-IkBα (Phospho I-kappa-B-alpha), and significantly inhibited the nuclear translocation of NF-κB/p65. Based on these results, Isotelekin at 10 µm in in vitro and at 30mgkg-1 in in vivo demonstrated strong anti-inflammatory and immunosuppressive therapeutic potential.