Activation of nicotinic acetylcholine receptor alpha7 subunit (α7nAChR) by nicotine leads to the improved survival rate in experimental model of sepsis. Previously, we demonstrated that heme oxygenase (HO)-1 inducers or carbon monoxide significantly increased survival of lipopolysaccharide (LPS)-induced and cecal ligation and puncture-induced septic mice by reduction of high mobility group box 1 release, a late mediator of sepsis. However, that activation of α7nAChR by nicotine provides anti-inflammatory action through HO-1 upregulation has not been elucidated. Here we show that HO-1-inducible effect by nicotine was mediated through sequential event-Ca(2+) influx, classical protein kinase C activation, and reactive oxygen species production-which activates phosphoinositol-3-kinase/Akt/Nrf-2 pathway. In addition, HO-1 is required for nicotine-mediated suppression of tumor necrosis factor-α, inducible nitric oxide synthase, and high mobility group box 1 expression induced by LPS in macrophages, as evidenced by the fact that nicotine failed to inhibit production of these mediators when HO-1 was suppressed. Importantly, nicotine-induced survival rate was reduced by inhibition of HO-1 in LPS- and cecal ligation and puncture-treated septic mice. Collectively, these data suggest that activation of α7nAChR by nicotine is critical in the regulation of anti-inflammatory process, which could be mediated through HO-1 expression. Thus, we conclude that activation of α7nAChR by nicotine provides anti-inflammatory action through HO-1 upregulation.