BACKGROUND Paeonia lactiflora root (baishao in Chinese) is a commonly used herb in TCM. Research has shown baishao to have positive pharmacological actions, including, particularly, anti-inflammatory properties. In this paper we studied the influence of baishao extract on cAMP-phosphodiesterase (PDE) activity and related anti-inflammatory action to identify new pharmacologic action for its clinically widespread use. METHODS PDE activity was calculated by cAMP change examined with HPLC, respiratory burst of neutrophils was detected with method of cytochrome C reduction, elastase release was indicated with the substrate reduction, rat arthritis model was caused by complete Freund's adjuvant, mouse capillary permeability model was made by acetic acid, and chemical constituents of baishao extract was identified by HPLC, mass spectroscopy and NMR spectrum. RESULTS Baishao extract had significant inhibition on cAMP-PDE activity (p<0.01), had dose dependent restraint on neutrophils respiratory burst (p<0.001), had inhibition at low concentration and promotion at high concentration on elastase release (p<0.05), and had obvious restraint on local inflammation of animal model (p<0.01). Analysis of HPLC, mass spectroscopy and NMR spectrum showed baishao extract mainly had five components (identified as gallic acid, paeoniflorin sulfonate, albiflorin, paeoniflorin and benzoic acid), among which gallic acid had the largest inhibition on cAMP-PDE activity. CONCLUSIONS The anti-inflammatory effects of baishao may be mediated, at least in part, through its gallic acid content, and this effect may be regulated in part by an inhibition on cAMP-PDE.