Immune-mediated inflammatory diseases (IMIDs) comprise a broad spectrum of conditions characterized by systemic inflammation affecting various organs and tissues, for which there is no known cure. The isoform-specific inhibition of phosphodiesterase-4B (PDE4B) over PDE4D constitutes an effective therapeutic strategy for the treatment of IMIDs that minimizes the adverse effects associated with non-selective PDE4 inhibitors. Thus, we report a new class of isoquinolone derivatives as next-generation PDE4 inhibitors for effective management of rheumatoid arthritis (RA) and psoriasis. Among the series, 8 compounds i.e. 1e, 1l, 1m, 1n, 1o, 2m, 2o and 3o showed promising PDE4B inhibition (>80 %) in vitro with IC50 ∼ 1.4-6.2 µM. The compound 1l was identified as an initial hit and was pursued for further studies. According to structure-activity relationship (SAR), an allyl group at C-4 position improved PDE4B inhibition. The correlation between in vitro activity data and binding affinities obtained via molecular docking suggested that the high-affinity binding to PDE4B is a prerequisite for the effective inhibition of PDE4B. Notably, the hit 1l showed selectivity towards PDE4B over PDE4D in vitro. Furthermore, 1l treatment (30 mg/kg) in the adjuvant-induced arthritis (AIA) rat model induced by complete Freund's adjuvant (CFA) demonstrated anti-arthritic potential via ameliorating paw swelling and body weight, narrowing joint space, reducing excessive immune cells infiltration and pannus formation in addition to reducing mRNA expression of pro-inflammatory cytokines such as TNF-α and IL-6 in synovial tissues of experimental rats. Additionally, 1l reduced the hyper-proliferative state and colony forming potential of IMQ-induced psoriatic keratinocytes. The treatment of these cells with 1l markedly reduced the protein levels of Ki67 and mRNA levels of pro-inflammatory cytokines e.g. IL-17A and TNF-α suggesting its potent anti-psoriatic potential. Furthermore, 1l did not show any significant adverse effects when evaluated in a systematic toxicity (e.g. teratogenicity, hepatotoxicity and cardiotoxicity) studies in zebrafish at the tested concentrations (1-100 µM) and the NOAEL (no-observed-adverse-effect level) was found to be 100 µM. Thus, with promising anti-inflammatory effects both in vitro and in vivo along with PDE4B selectivity with an acceptable safety margin, 1l emerged as a new and promising inhibitor for further studies.