Background. Inflammatory bowel disease (IBD) is a major cause of morbidity and mortality due to its repetitive remission and relapse. The Jian-Wei-Yu-Yang (JW) formula has a historical application in the clinic to combat gastrointestinal disorders. The investigation aimed to explore the molecular and cellular mechanisms of JW. Methods. 2% dextran sodium sulfate (DSS) was diluted in drinking water and given to mice for 5 days to establish murine models of experimental colitis, and different doses of JW solution were administered for 14 days. Network pharmacology analysis and weighted gene co-expression network analysis (WGCNA) were utilized to predict the therapeutic role of JW against experimental colitis and colitis-associated colorectal cancer (CAC). 16S rRNA sequencing and untargeted metabolomics were conducted using murine feces. Western blotting, immunocytochemistry, and wound healing experiments were performed to confirm the molecular mechanisms. Results. (1) Liquid chromatography with mass spectrometry was utilized to confirm the validity of the JW formula. The high dose of JW treatment markedly attenuated DSS-induced experimental colitis progression, and the targets were enriched in inflammation, infection, and tumorigenesis. (2) The JW targets were related to the survival probability in patients with colorectal cancer, underlying a potential therapeutic value in CRC intervention. (3) Moreover, the JW therapy successfully rescued the decreased richness and diversity of microbiota, suppressed the potentially pathogenic phenotype of the gut microorganisms, and increased cytochrome P450 activity in murine colitis models. (4) Our in vitro experiments confirmed that the JW treatment suppressed caspase3-dependent pyroptosis, hypoxia-inducible factor 1α (HIF1α), and interleukin-1b (IL-1b) in the colon; facilitated the alternative activation of macrophages (Mφs); and inhibited tumor necrosis factor-α (TNFα)-induced reactive oxygen species (ROS) level in intestinal organoids (IOs). Conclusion. The JW capsule attenuated the progression of murine colitis by a prompt resolution of inflammation and bloody stool and by re-establishing a microbiome profile that favors re-epithelization and prevents carcinogenesis.