The current study was aimed to reveal that leucodin, a sesquiterpene lactone from Artemisia capillaris could inhibit the inflammatory response in macrophages and the lipid accumulation in hepatocytes via P2x7R-NLRP3 inflammasome activation. Several types of macrophages including mouse peritoneal macrophages, mouse bone marrow-derived macrophages and human macrophages THP-1 cells were pretreated with different concentrations of leucodin for 1 h and then stimulated with LPS and ATP. LPS plus ATP initiated IL-1β cleavage and release in mouse peritoneal macrophages and peaked at 4 h. Leucodin did not show significant toxicity within 200 μM and effectively inhibited pro-IL-1β cleavage and release of mature-IL-1β in macrophages. Also, P2x7R antagonist and caspase-1 inhibitor also decreased IL-1β release and cleavage. Additionally, leucodin suppressed P2x7R, TLR4 and NLRP3 expression in LPS/ATP-stimulated macrophages. HepG2 cells were pretreated with different concentrations of leucodin for 1 h and then exposed to ethanol for 24 h. Leucodin suppressed lipid accumulation and enhanced phosphorylation of AMP-activated protein kinase (AMPK) and acetyl-CoA carboxylase (ACC) in HepG2 cells exposed to ethanol. In addition, leucodin inhibited the expression of sterol regulatory element binding protein-1 (SREBP1) and ACC in ethanol-treated HepG2 cells. Leucodin possessed the capacity for inhibiting inflammatory response in macrophages and suppressing lipid accumulation in hepatocytes, suggesting a promising therapeutic potential targeting inflammation and lipid metabolism in alcoholic liver disease.