Tamarix aphylla is a commonly grown plant in Saudi Arabia and its therapeutic potential is widely recognized. Here, in this study, the aim was to explore the role of T. aphylla leaf extract (TAE) on lipopolysaccharide (LPS)-induced acute lung injury (ALI) in mice and LPS-stimulated RAW 264.7 cells. The antioxidant and anti-inflammatory parameters of TAE were performed through in vitro assays by measuring H2O2 free radical scavenging and protein denaturation inhibition. After LPS administration, broncho alveolar lavage fluid (BALF) and lung tissue were obtained to evaluate the pro-inflammatory cytokine levels, histopathological alterations, immunohistochemistry and TUNEL staining. The results designate that TAE shows anti-inflammatory activity through a decrease in pro-inflammatory cytokines, TNF-α and IL-6 in LPS-stimulated RAW 264.7 cells and BALF. The antioxidant enzyme level (SOD) decreased and MDA content was increased in the LPS-induced mice. However, TAE pretreatment markedly reversed these parameters compared to the group administered LPS only (p < 0.05). The histopathological analysis demonstrated that TAE maintained the lung tissue architecture by reducing LPS-induced inflammation and congestion. The expression pattern of the Cox-2 protein and apoptosis was high in the group administered LPS only, whereas TAE pretreatment showed a reduction in the expression pattern and apoptosis. Moreover, the in vitro assay of TAE demonstrated a concentration-dependent free radical scavenging and anti-inflammatory activity. In conclusion, our results advocate the health-promoting effects of T. aphylla on LPS-induced acute lung injury, which might be due to its antioxidative and anti-inflammatory potential.