Background: Exosomes are ubiquitous naturally secreted stable nanovesicles that can be engineered to target and deliver novel therapeutics to treat a host of human diseases. Methods: We engineered the surfaces of cell-derived nanovesicles to act as decoys in the treatment of inflammation by antagonizing the major proinflammatory cytokine, tumor necrosis factor alpha (TNFa). Results: Decoy exosomes were generated by displaying the TNFa binding domain of human TNF receptor-1 (hTNFR1) on the outer surface of exosomes using stably transfected HEK293 cells. We developed an efficient method to purify the engineered exosomes from conditioned medium based on sequential centrifugation, ultrafiltration, and precipitation. We characterized decoy exosomes using immune-quantification, nanoparticle tracking analysis, and confocal microscopy to confirm that they retain the correct orientation, size, and shape of naturally produced exosomes. We demonstrated the engineered decoy exosomes specifically antagonize activities of TNFa using an inflammatory reporter cell line. Conclusions: Decoy exosomes produced in human cells serve as a novel biologic reagent for antagonizing inflammatory signaling mediated by TNFa.