The peroxisome proliferator-activated receptor gamma (PPARgamma) is a member of the nuclear receptor superfamily, a group of transcription factors that regulate expression of their target genes upon ligand binding. As endogenous ligands, oxidized fatty acids and prostanoids can bind to and activate the receptor. Natural and synthetic PPARgamma activators have been studied extensively in many inflammatory settings and in most instances they have been shown to be anti-inflammatory. In this review we give an overview of the different molecular mechanisms how PPARgamma and its agonists exert their anti-inflammatory effects both at the cellular level and the level of the organism. The action of PPARgamma in acute and chronic inflammatory diseases and disease models will be presented.