A new anthranilic acid derivative (1) was isolated from a Philippine sponge, Oscarella stillans (Bergquist and Kelly). The structure of compound 1, named oscarellin, was determined as 2-amino-3-(3'-aminopropoxy)benzoic acid from spectroscopic data and confirmed by synthesis. We examined the immunomodulating effect of compound 1 and its mechanism in lipopolysaccharide (LPS)-stimulated RAW 264.7 macrophages. Our data indicated that the expression of tumor necrosis factor-α (TNF-α) and interleukin (IL)-6 were significantly reduced by the pretreatment of 1 (0.1-10 μM) for 2 h. In addition, compound 1 suppressed activation of extracellular signal-regulated kinase 1/2 (ERK1/2) and c-Jun NH2-termimal kinase (JNK), but not p38 mitogen-activated protein kinase (MAPK) in LPS-stimulated RAW 264.7 cells. Compound 1 abrogated LPS-induced nuclear factor-κB (NF-κB) and activator protein-1 (AP-1) activities, whereas the induction of activating transcription factor-3 (ATF-3) was increased. Taken together, our results suggest that compound 1 attenuates pro-inflammatory cytokines via the suppression of JNK, ERK, AP-1, and NF-κB and the activation of the ATF-3 signaling pathway.