Artemisinin and its derivatives exhibit potent immunosuppressive activity. The aim of this study was to investigate the suppressive effects of SM905, a new water-soluble artemisinin derivative, on T lymphocytes both in vitro and in vivo, and explore its potential mode of action. The results showed that SM905 had a high inhibitory activity in Concanavalin A (ConA)-induced splenocyte proliferation and mixed lymphocyte reaction, and a relatively low cytotoxicity in vitro. In ovalbumin-immunized mice, oral administration of SM905 dose-dependently suppressed T cell proliferative response to ovalbumin, and inhibited anti-ovalbumin interleukin-2 (IL-2) and interferon-gamma (IFN-gamma) production by T cells. Further studies showed that SM905 inhibited TCR (T cell receptor)/CD3 plus CD28-mediated primary T cell proliferation and cytokine production (IL-2 and IFN-gamma), and exerted an inhibitory action on the phosphorylation of mitogen-activated protein (MAP) kinases including extracellular signal-regulated kinase (ERK), p38 and Jun N-terminal kinase (JNK), and the activation of Ras. The results of this study provided experimental evidence that the new artemisinin derivative SM905 had immunosuppressive effects both in vitro and in vivo. SM905 suppressed T cell activation, which was associated with the inhibition of MAP kinases and Ras activation. Our results suggested a potential of SM905 to be developed as a new type agent for treating T cell-mediated immune disorder.