RAGE and its intracellular effector molecule, the actin polymerase DIAPH1, mediate inflammation and the complications of diabetes. Using NMR spectroscopy and mass spectrometry, we built a structural model of the RAGE-DIAPH1 complex, revealing how binding of the cytoplasmic tail of RAGE (ctRAGE) to DIAPH1 stimulates its actin polymerization activity, which is inhibited by a small molecule antagonist of RAGE-DIAPH1 interaction, RAGE406R. The solution structure of the RAGE406R - ctRAGE suggests that RAGE406R prevents the formation of the RAGE-DIAPH1. FRET, actin polymerization assays, smooth muscle cell migration, and THP1 cell inflammation experiments, together with the in vivo interrogation of the effects of RAGE406R in mouse models of inflammation and diabetic wound healing, support this mode of RAGE-DIAPH1 antagonism. Finally, the treatment of macrophages differentiated from peripheral blood-derived mononuclear cells from humans with type 1 diabetes with RAGE406R reduces the mRNA expression of the chemokine CCL2, diminishing the expression of a key node in the inflammatory response.