Uncontrolled TLR4 signaling may induce excessive production of proinflammatory cytokines and lead to harmful inflammation; therefore, negative regulation of TLR4 signaling attracts much attention now. PECAM-1, a member of Ig-ITIM family, can mediate inhibitory signals in T cells and B cells. However, the role and the mechanisms of PECAM-1 in the regulation of TLR4-mediated LPS response in macrophages remain unclear. In this study, we demonstrate that PECAM-1 ligation with CD38-Fc fusion protein negatively regulates LPS-induced proinflammatory cytokine TNF-alpha, IL-6, and IFN-beta production by inhibiting JNK, NF-kappaB, and IFN regulatory factor 3 activation in macrophages. In addition, PECAM-1 ligation-recruited Src homology region 2 domain-containing phosphatase 1 (SHP-1) and Src homology region 2 domain-containing phosphatase 2 (SHP-2) may be involved in the inhibitory effect of PECAM-1 on TLR4 signaling. Consistently, silencing of PECAM-1 enhances the macrophage response to LPS stimulation. Taken together with the data that PECAM-1 is constitutively expressed in macrophages and its expression is up-regulated by LPS stimulation, PECAM-1 might function as a feedback negative regulator of LPS inflammatory response in macrophages. This study may provide a potential target for intervention of inflammatory diseases.