Neuroinflammation and oxidative stress play an important role in cognition deficit following chronic cerebral hypoperfusion (CCH). Luteolin, a natural flavonoid found in many plants, is known for a variety of pharmacological activities, such as its anti-inflammatory, anti-allergy, urate, anti-tumor, antibacterial, and antiviral effects. To assess whether luteolin could prevent CCH-induced cognitive dysfunction, through its anti-inflammatory and anti-oxidative-stress effects, we used enzyme-linked immunosorbent assays, enzyme activity assays, behavioral methods, immunohistochemistry, and electrophysiology to detect neuroinflammation and oxidative stress, cognition alterations, and long-term potential (LTP), in a bilateral common carotid arteries ligation (2VO) rat model. We demonstrated that CCH increased tumor necrosis factor α (TNF-α), interleukin 1β (IL-1β), interleukin 6 (IL-6), and malondialdehyde (MDA), and decreased superoxide dismutase (SOD) and glutathione peroxidase (GPx) levels. Further, it caused microglia over-activation and astrogliosis, learning and short-term memory dysfunction, and an LTP deficit. Luteolin treatment reversed CCH-induced changes. Specifically, luteolin prevented the increase of TNF-α and IL-1β, IL-6, and MDA, improved the activity of SOD and GPx, inhibited microglia over-activation and astrogliosis (particularly in the hippocampus and cortex), and ameliorated learning and short-term memory dysfunction, and LTP deficit. Thus, our study suggested that luteolin could be a preferable anti-inflammatory agent to protect cognitive function and synaptic plasticity following CCH. Luteolin could also be putative therapeutic candidate for other inflammation-related brain diseases.