BackgroundTraditional Chinese medicine (TCM) formula Bi-Qi capsule (Bi-Qi) is a commonly prescribed drug to treat rheumatoid arthritis (RA). However, the mechanism of Bi-Qi-mediated amelioration of RA pathogenesis is still a mystery. Collagen induced arthritis (CIA) in rats is an established model that shares many similarities with RA in humans. In this study we investigated the effect of Bi-Qi on the pathogenesis of CIA in rats.MethodsCIA was developed in Sprague-Dawley (S.D) rats (n = 60, female) and used as a model resembling RA in humans. Rats were treated with a high or moderate dose of Bi-Qi, or methotrexate (MTX). Effects of the treatment on local joint and systemic inflammation, synovial hyperplasia, cartilage destruction, and other main features in the pathogenesis of CIA were analyzed.ResultsInflamed and swollen ankles and joints were observed in arthritic rats, while Bi-Qi or MTX treatment alleviated these symptoms. Only the Bi-Qi moderate dose decreased RA-induced serum levels of tumor necrosis factor-alpha (TNF-α). Both Bi-Qi and MTX reduced the interleukin (IL)-18 serum level. Protein levels of cartilage oligomeric matrix protein and osteopontin in serum, synovium, and cartilage were elevated in arthritic rats, while Bi-Qi alleviated these effects. Synovial hyperplasia, inflammatory cell infiltration in synovium and a high degree of cartilage degradation was observed in RA, and Bi-Qi or MTX alleviated this effect. Bi-Qi at the moderate dose was the most effective in mitigating CIA-related clinical complications.ConclusionsOur findings showed that Bi-Qi alleviates CIA-induced inflammation, synovial hyperplasia, cartilage destruction, and the other main features in the pathogenesis of CIA. This provides fundamental evidence for the anti-arthritic properties of Bi-Qi and corroborates the use of Bi-Qi TCM formula for the treatment of RA.Electronic supplementary materialThe online version of this article (10.1186/s13075-018-1547-6) contains supplementary material, which is available to authorized users.