The striatal-enriched phosphatase (STEP) is a component of the NMDA-receptor-mediated excitotoxic signaling pathway, which plays a key role in ischemic brain injury. Using neuronal cultures and a rat model of ischemic stroke, we show that STEP plays an initial role in neuroprotection, during the insult, by disrupting the p38 MAPK pathway. Degradation of active STEP during reperfusion precedes ischemic brain damage and is associated with secondary activation of p38 MAPK. Application of a cell-permeable STEP-derived peptide that is resistant to degradation and binds to p38 MAPK protects cultured neurons from hypoxia-reoxygenation injury and reduces ischemic brain damage when injected up to 6 h after the insult. Conversely, genetic deletion of STEP in mice leads to sustained p38 MAPK activation and exacerbates brain injury and neurological deficits after ischemia. Administration of the STEP-derived peptide at the onset of reperfusion not only prevents the sustained p38 MAPK activation but also reduces ischemic brain damage in STEP KO mice. The findings indicate a neuroprotective role of STEP and suggest a potential role of the STEP-derived peptide in stroke therapy.