Steroidal and non-steroidal anti-inflammatory drugs are widely used for treating a spectrum of inflammatory conditions; however, their systemic adverse effects hinder their usage. Therefore, alternate therapeutic strategies are required to treat inflammatory disorders. Parthenin, a lactone derived from Parthenium hysterophorus, has demonstrated anti-inflammatory activity; however, its toxic nature limits its application. We proposed modifications of parthenin to enhance its efficacy while reducing toxicity. In this context, we screened parthenin derivatives for anti-inflammatory efficacy and identified dispiro-indanedione hybrid of parthenin (DIHP) as a potent anti-inflammatory agent. Macrophages were pre-treated with DIHP followed by LPS stimulation to evaluate the in-vitro anti-inflammatory and anti-oxidant activity. We assessed in-vivo anti-inflammatory effect of DIHP in carrageenan-induced paw edema and LPS-induced sepsis model. Our findings showed that DIHP exerts negligible effect on cell viability, effectively attenuates the production of inflammatory markers (NO, TNF-α, IL-6 &IL-1β) and down-regulates NF-κB, MAPK pathways in in-vitro and in-vivo system. Additionally, DIHP inhibited LPS-induced generation of prostaglandin E2, leukotriene B4, ROS and upregulated the expression of superoxide dismutase, catalase, nuclear factor-E2-related factor 2 and peroxisome proliferator-activated receptor gamma. Furthermore, DIHP effectively reduced carrageenan-induced paw edema and curtailed the levels of liver, and kidney damage markers (AST, ALT, CRE, and BUN), protected the lung, liver and kidney against pathological damage and enhanced the survival rate in LPS-challenged mice. DIHP demonstrated comparable efficacy to dexamethasone in reducing inflammatory markers. In conclusion, our study strongly suggests that DIHP curtailed inflammation and oxidative stress by down regulating NF-κB and MAPK pathways and enhanced anti-oxidant response.