Here we show that soluble CD83 induces the resolution of inflammation in an antigen-induced arthritis (AIA) model. Joint swelling and the arthritis-related expression levels of IL-1β, IL-6, RANKL, MMP9, and OC-Stamp were strongly reduced, while Foxp3 was induced. In addition, we observed a significant inhibition of TRAP+ osteoclast formation, correlating with the reduced arthritic disease score. In contrast, cell-specific deletion of CD83 in human and murine precursor cells resulted in an enhanced formation of mature osteoclasts. RNA sequencing analyses, comparing sCD83- with mock treated cells, revealed a strong downregulation of osteoclastogenic factors, such as Oc-Stamp, Mmp9 and Nfatc1, Ctsk, and Trap. Concomitantly, transcripts typical for pro-resolving macrophages, e.g., Mrc1/2, Marco, Klf4, and Mertk, were upregulated. Interestingly, members of the metallothionein (MT) family, which have been associated with a reduced arthritic disease severity, were also highly induced by sCD83 in samples derived from RA patients. Finally, we elucidated the sCD83-induced signaling cascade downstream to its binding to the Toll-like receptor 4/(TLR4/MD2) receptor complex using CRISPR/Cas9-induced knockdowns of TLR4/MyD88/TRIF and MTs, revealing that sCD83 acts via the TRIF-signaling cascade. In conclusion, sCD83 represents a promising therapeutic approach to induce the resolution of inflammation and to prevent bone erosion in autoimmune arthritis.