Muktashukti bhasma (MSB), an Ayurvedic compound, consisting of pearl, Aloe vera and vinegar, inhibited acute and subacute inflammation in albino rats as induced by subplanter injection of carrageenan, histamine, 5-HT, nystatin and subcutaneous implant of cotton pellets. In all the test procedures the antiinflammatory response of 1000 mg/kg MSB was comparable to the response observed with 300 mg/kg acetylsalicylic acid (ASA). Oral premedication with MSB delayed castor oil-induced diarrhoea in rats, indicating its prostaglandin inhibitory activity. The antiinflammatory activity of the compound is attributed to its ability to cause inhibition of prostaglandins, histamine and 5-HT and also by stabilization of the lysosomal membranes. The antiinflammatory activity of MSB seems one third to half as potent as ASA.