A detailed investigation on the anti-inflammatory activity of the butanol fraction of a methanol extract (BMEL) of the defatted leaves of Paederia foetida was undertaken to find the pharmacological basis for the ethnomedical use of the plant. This fraction produced a significant inhibition of granulation tissue formation in cotton-pellet implanted rats. It decreased liver aspartate transaminase activity without affecting serum aspartate transaminase activity. It did not, however, affect adrenal weight and ascorbic acid content significantly, thus ruling out a stimulation of the adrenal-pituitary axis. BMEL antagonised hyposaline-induced haemolysis of human red blood cells and an elevation of rat serum acid phosphatase activity, indicating the presence of a membrane stabilising activity. It also inhibited the elevation of serum orosomucoid levels in rats, suggesting the possibility of the presence of disease-modifying antirheumatic activity. The results indicate that there is some rationale behind the ethnomedical use of the plant for treating inflammatory disorders.