Multiple sclerosis (MS) is a chronic autoimmune neuroinflammatory disease found mostly in young adults in the western world. Oxidative stress induced neuronal apoptosis plays an important role in the pathogenesis of MS. In current study, astragaloside IV (ASI), a natural saponin molecule isolated from Astragalus membranceus, given at 20 mg/kg daily attenuated the severity of experimental autoimmune encephalomyelitis (EAE) in mice significantly. Further studies disclosed that ASI treatment inhibited the increase of ROS and pro-inflammatory cytokine levels, down-regulation of SOD and GSH-Px activities, and elevation of iNOS, p53 and phosphorylated tau in central nervous system (CNS) as well as the leakage of BBB of EAE mice. Meanwhile, the decreased ratio of Bcl-2/Bax was reversed by ASI. Moreover, ASI regulated T-cell differentiation and infiltration into CNS. In neuroblast SH-SY5Y cells, ASI dose-dependently reduced cellular ROS level and phosphorylation of tau in response to hydrogen peroxide challenge by modulation of Bcl-2/Bax ratio. ASI also inhibited activation of microglia both in vivo and in vitro. iNOS up-regulation induced by IFNgamma stimulation was abolished by ASI dose-dependently in BV-2 cells. In summary, ASI prevented the severity of EAE progression possibly by counterbalancing oxidative stress and its effects via reduction of cellular ROS level, enhancement of antioxidant defense system, increase of anti-apoptotic and anti-inflammatory pathways, as well as modulation of T-cell differentiation and infiltration into CNS. The study suggested ASI may be effective for clinical therapy/prevention of MS.