Abstract Objective During treatment with immune checkpoint inhibitors (ICI) such as the anti-PD-1 antibody pembrolizumab, half of patients with pre-existing inflammatory arthritis experience disease flares. The underlying immunological mechanisms have not been characterized. Here, we investigate the effect of pembrolizumab on cells involved in inflammation and destruction in the synovial joint and how immunosuppressive treatments affect the pembrolizumab-induced immune reactions. Methods We included synovial fluid mononuclear cells (SFMCs, n = 28) and peripheral blood mononuclear cells (PBMCs, n = 6) from patients with rheumatoid arthritis and peripheral spondyloarthritis and PBMCs from healthy controls (n = 6). Fibroblast-like synovial cells (FLSs) were grown from SFMCs. The in vitro effect of pembrolizumab was tested in SFMCs cultured for 48 h, FLS-PBMC co-cultures and in SFMCs cultured for 21 days (inflammatory osteoclastogenesis). Cells and supernatants were analyzed by ELISA, flow cytometry, and pro-inflammatory multiplex assay. Finally, the effect of the disease-modifying anti-rheumatic drugs (DMARDs) adalimumab (TNFα inhibitor), tocilizumab (IL-6R inhibitor), tofacitinib (JAK1/JAK3 inhibitor), and baricitinib (JAK1/JAK2 inhibitor) on pembrolizumab-induced immune reactions was tested. Results Pembrolizumab significantly increased monocyte chemoattractant protein-1 (MCP-1) production by arthritis SFMCs (P = 0.0031) but not by PBMCs from patients or healthy controls (P = 0.77 and P = 0.43). Pembrolizumab did not alter MMP-3 production in FLS-PBMC co-cultures (P = 0.76) or TRAP secretion in the inflammatory osteoclastogenesis model (P = 0.28). In SFMCs, pembrolizumab further increased the production of TNFα (P = 0.0110), IFNγ (P = 0.0125), IL-12p70 (P = 0.0014), IL-10 (P = 0.0100), IL-13 (P = 0.0044), IL-2 (P = 0.0066), and IL-4 (P = 0.0008) but did not change the production of IL-6 (P = 0.1938) and IL-1 (P = 0.1022). The SFMCs treated with pembrolizumab showed an increased frequency of intermediate monocytes (P = 0.044), and the MCP-1 production increased only within the intermediate monocyte subset (P = 0.028). Lastly, adalimumab, baricitinib, and tofacitinib treatment were able to attenuate the pembrolizumab-induced MCP-1 production (P = 0.0004, P = 0.033, and P = 0.025, respectively), while this was not seen with tocilizumab treatment (P = 0.75). Conclusion Pembrolizumab specifically activated intermediate monocytes and induced the production of several cytokines including TNFα but not IL-6. These findings indicate that flares in patients with pre-existing inflammatory arthritis involve monocyte activation and could be managed with TNFα neutralization.