Andrographolide is compound extracted from Andrographis paniculata (A. paniculata), a traditional herb that has been used in ancient China and other parts of eastern Asia to treat an array of disorders, such as cancer, rheumatoid arthritis, diarrhea, upper respiratory tract infection, and laryngitis, for a very long history. The mechanisms of action of andrographolide in disease prevention and/or therapy include anti-inflammation, anti-oxidative stress, anti-apoptosis, and/or pro-apoptosis. Pharmacodynamic studies have shown that andrographolide can cross the blood brain barrier and distribute into different brain regions, and therefore its pharmacological effects in the central nervous system (CNS) have begun to be revealed in recent years. For example, andrographolide has been reported to reduce brain infarct volume in several models of cerebral ischemia. In models of Alzheimer’s disease (AD), andrographolide not only reduces Aβ aggregation, but suppresses neuroinflammatory response and synaptic dysfunction, which could be evidenced by the reversal of microglia-mediated production of pro-inflammatory cytokines as well as AD-associated decreases in synaptic proteins, such as postsynaptic membrane dense substance-95. Andrographolide may also inhibit the onset and/or progression of Parkinson’s disease, multiple sclerosis, and surgery- or diabetes-induced cognitive impairment. Further, andrographolide has been shown to inhibit chronic stress-induced abnormalities in serum corticosterone levels, mood-associated behavior, and hippocampal neurogenesis, suggesting that andrographolide may have a potential to treat psychiatric disorders, such as anxiety and depression. In this review, we summarize and discuss the pharmacological effects of andrographolide in the CNS in hope of revealing more possibilities of andrographolide in disease prevention and/or therapy.