TGF-beta1 is one of the most potent endogenous immune modulators of inflammation. The molecular mechanism of its anti-inflammatory effect on the activation of the transcription factor NF-kappaB has been well-studied; however, the potential effects of TGF-beta1 on other proinflammatory signaling pathways is less clear. In this study, using the well-established LPS and the 1-methyl-4-phenylpyridinium-mediated models of Parkinson's disease, we demonstrate that TGF-beta1 exerts significant neuroprotection in both models via its anti-inflammatory properties. The neuroprotective effects of TGF-beta1 are mainly attributed to its ability to inhibit the production of reactive oxygen species from microglia during their activation or reactivation. Moreover, we demonstrate that TGF-beta1 inhibited LPS-induced NADPH oxidase (PHOX) subunit p47phox translocation from the cytosol to the membrane in microglia within 10 min. Mechanistic studies show that TGF-beta1 fails to protect dopaminergic neurons in cultures from PHOX knockout mice, and significantly reduced LPS-induced translocation of the PHOX cytosolic subunit p47phox to the cell membrane. In addition, LPS-induced ERK phosphorylation and subsequent Ser345 phosphorylation on p47phox were significantly inhibited by TGF-beta1 pretreatment. Taken together, our results show that TGF-beta1 exerted potent anti-inflammatory and neuroprotective properties, either through the prevention of the direct activation of microglia by LPS, or indirectly through the inhibition of reactive microgliosis elicited by 1-methyl-4-phenylpyridinium. The molecular mechanisms of TGF-beta1-mediated anti-inflammatory properties is through the inhibition of PHOX activity by preventing the ERK-dependent phosphorylation of Ser345 on p47phox in microglia to reduce oxidase activities induced by LPS.