The anti-inflammatory cytokine interleukin-37 (IL-37) belongs to the IL-1 family but is not expressed in mice. We used a human IL-37 (hIL-37tg) expressing mouse, which has been subjected to various models of local and systemic inflammation as well as immunological challenges. Previous studies reveal an immunomodulatory role of IL-37, which can be characterized as an important suppressor of innate immunity. Here, we examined the functions of IL-37 in the central nervous system and explored the effects of IL-37 on neuronal architecture and function, microglial phenotype, cytokine production and behavior after inflammatory challenge by intraperitoneal LPS-injection. In wild-type mice, decreased spine density, activated microglial phenotype and impaired long-term potentiation (LTP) were observed after LPS injection, whereas hIL-37tg mice showed no impairment. In addition, we crossed the hIL-37tg mouse with an animal model of Alzheimer’s disease (APP/PS1) to investigate the anti-inflammatory properties of IL-37 under chronic neuroinflammatory conditions. Our results show that expression of IL-37 is able to limit inflammation in the brain after acute inflammatory events and prevent loss of cognitive abilities in a mouse model of AD.