Caffeic acid (3,4-dihydroxycinnamic acid, CA) has been reported to have anti-inflammatory activity in animal models. However, the mechanisms underlying the anti-inflammatory effects of CA in skin inflammation are only partially understood. The present study was designed to investigate the effects and mechanisms of CA on acute and chronic skin inflammation in mice and the effect of CA in keratinocytes in vitro. The results showed that topical treatment with CA inhibited 12-O-tetradecanoyl-phorbol-13-acetate (TPA)-induced skin edema in a dose-dependent manner, leading to substantial reductions in skin thickness and tissue weight, neutrophil-mediated myeloperoxidase activity, and various histopathological indicators. The CA treatment also significantly reduced the mRNA and protein levels of tumor necrosis factor alpha (TNF-α), interleukin-6 (IL-6) and IL-1β at the application site, and the TNF-α production, the TNF-α-induced IL-6 and IL-1β production, and TNF-α-induced nuclear factor-kappa B (NF-κB) activation in human keratinocytes in vitro. Furthermore, CA was effective at reducing inflammatory damage induced by chronic TPA exposure. These results demonstrate that CA has anti-inflammatory activities in both acute and chronic contact dermatitis models via blockade of the mRNA and protein synthesis of these cytokines and neutrophil-mediated myeloperoxidase activity, and can target inflammatory mediators specifically in the keratinocytes. Taken together, the present results suggest that CA might be a therapeutic agent against inflammatory skin diseases.