Terpenes in general and triterpenes in particular showed anti-inflammatory activity and act as immunomodulators in nutraceutical agents. Antiinflammation, a useful and attractive approach in experimental oncology, helps to investigate the inflammation preventive potential of natural products and synthetic entities. During the course of our research work in natural product chemistry and synthesis of novel structures in the field of heterocyclic chemistry, we found interesting results. In natural product betulinic acid, α-amyrin acetate, lupeol acetate, oleanolic acid, ursolic acid and their derivatives showed interesting potential analgesic and anti-inflammatory activity. In this review specific reference has been made to novel classes and newly discovered compounds in the literature, which exhibited required activities. Indomethacine is a potent synthetic compound, which becomes the basis of novel anti-inflammatory agents. Shen postulated a receptor theory which indicates the physical parameters responsible for anti-inflammatory activity. Attempt has been made to cover almost all the anti-inflammatory agents which fall under the various chemical structural classes of compounds showing required activity. The objective of this review is to compile relevant data on the mechanism of action of terpenes isolated from active ethnomedicinal plants to examine the role terpenoids have in medicinal plants used against inflammatory diseases, especially those in which an immune response is implicated. In addition, a selection of several structurally related compounds has been compiled in order to analyze the possible structural characteristics and relationships between the different types of structures found in triterpenoids. The selection of active species was made on the basis of their immunomodulatory activity, and their role in the resolution of diseases in which the immune system is implicated to examine the mechanism by which they are useful as ethnopharmacological medicines. These terpenes include ursolic acid, oleanolic acid, betulinic acid. This review discusses in detail the preclinical studies conducted with triterpenes and provides an insight into its mechanism of action.