Phellinus igniarius has been clinically used for the treatment of hemorrhoidal fistula, dysmenorrhea and the prevention of cancer in traditional oriental medicine. Recent studies showed that Phellinus igniarius produced anti-cancer, anti-metastasis and immuno-modulatory effects, There is lack of studies regarding the effects of Phellinus igniarius on the immunological activities. The present study was conducted to evaluate the effect of Phellinus igniarius on the regulatory mechanism of cytokines and nitric oxide (NO) for the immunological activities in Raw 264,7 cells. After the treatment of Phellinus igniarius water extract, cell viability was measured by MTT assay, NO production was monitored by measuring the nitrite content in culture medium. COX-2 and iNOS were determined by Immunoblot analysis, and levels of cytokine were analyzed by sandwich immunoassays. Results provided evidence that Phellinus igniarius inhibited the production of nitrite and nitrate (NO), inducible nitric oxide synthase (iNOS), interleukin-1β (IL-1β) and interleukin-6 (IL-6), and the activation of phospholylation of inhibitor κBα (p-IκBα) in Raw 264.7 cells activated with lipopolysaccharide (LPS). These findings suggest that Phellinus igniarius can produce anti-inflammatory effect, which may play a role in adjunctive therapy in Gram-negative bacterial infections.