IL-37, a newly described member of the IL-1 family, functions as a fundamental inhibitor of innate inflammation and immunity. In the present study, we examined a role for IL-37 during experimental colitis. A transgenic mouse strain was generated to express human IL-37 (hIL-37tg), and these mice were subjected to dextran sulfate sodium (DSS)-induced colitis. Despite the presence of a CMV promoter to drive expression of IL-37, mRNA transcripts were not present in colons at the resting state. Expression was observed only upon disruption of the epithelial barrier, with a six- to sevenfold increase (P = 0.02) on days 3 and 5 after continuous exposure to DSS. During the development of colitis, clinical disease scores were reduced by 50% (P < 0.001), and histological indices of colitis were one-third less in hIL-37tg mice compared with WT counterparts (P < 0.001). Reduced inflammation was associated with decreased leukocyte recruitment into the colonic lamina propria. In addition, release of IL-1β and TNFα from ex vivo colonic explant tissue was decreased 5- and 13-fold, respectively, compared with WT (P ≤ 0.005), whereas IL-10 was increased sixfold (P < 0.001). However, IL-10 was not required for the anti-inflammatory effects of IL-37 because IL-10-receptor antibody blockade did not reverse IL-37-mediated protection. Mechanistically, IL-37 originating from hematopoietic cells was sufficient to exert anti-inflammatory effects because WT mice reconstituted with hIL-37tg bone marrow were protected from colitis. Thus, IL-37 emerges as key modulator of intestinal inflammation.