VAF347 is a low-molecular-weight compound that inhibits allergic lung inflammation in vivo. This effect is likely the result of a block of dendritic cell (DC) function to generate proinflammatory T-helper (Th) cells because VAF347 inhibits interleukin (IL)-6, CD86, and human leukocyte antigen (HLA)-DR expression by human monocyte-derived DC, 3 relevant molecules for Th-cell generation. Here we demonstrate that VAF347 interacts with the aryl hydrocarbon receptor (AhR) protein, resulting in activation of the AhR signaling pathway. Functional AhR is responsible for the biologic activity of VAF347 because (1) other AhR agonists display an identical activity profile in vitro, (2) gene silencing of wild-type AhR expression or forced overexpression of a trans-dominant negative AhR ablates VAF347 activity to inhibit cytokine induced IL-6 expression in a human monocytic cell line, and (3) AhR-deficient mice are resistant to the compound's ability to block allergic lung inflammation in vivo. These data identify the AhR protein as key molecular target of VAF347 and its essential role for mediating the anti-inflammatory effects of the compound in vitro and in vivo.