Abscisic acid (ABA) has shown efficacy in the treatment of diabetes and inflammation; however, its molecular targets and the mechanisms of action underlying its immunomodulatory effects remain unclear. This study investigates the role of peroxisome proliferator-activated receptor γ (PPAR γ) and lanthionine synthetase C-like 2 (LANCL2) as molecular targets for ABA. We demonstrate that ABA increases PPAR γ reporter activity in RAW 264.7 macrophages and increases ppar γ expression in vivo, although it does not bind to the ligand-binding domain of PPAR γ. LANCL2 knockdown studies provide evidence that ABA-mediated activation of macrophage PPAR γ is dependent on lancl2 expression. Consistent with the association of LANCL2 with G proteins, we provide evidence that ABA increases cAMP accumulation in immune cells. ABA suppresses LPS-induced prostaglandin E(2) and MCP-1 production via a PPAR γ-dependent mechanism possibly involving activation of PPAR γ and suppression of NF-κB and nuclear factor of activated T cells. LPS challenge studies in PPAR γ-expressing and immune cell-specific PPAR γ null mice demonstrate that ABA down-regulates toll-like receptor 4 expression in macrophages and T cells in vivo through a PPAR γ-dependent mechanism. Global transcriptomic profiling and confirmatory quantitative RT-PCR suggest novel candidate targets and demonstrate that ABA treatment mitigates the effect of LPS on the expression of genes involved in inflammation, metabolism, and cell signaling, in part, through PPAR γ. In conclusion, ABA decreases LPS-mediated inflammation and regulates innate immune responses through a bifurcating pathway involving LANCL2 and an alternative, ligand-binding domain-independent mechanism of PPAR γ activation.