Machilus macrantha Nees, Lauraceae, bark is traditionally used in the treatment of asthma, tuberculosis and rheumatoid arthritis. In order to validate, mechanism based anti-inflammatory activity of fractions M. macrantha bark are investigated for first time. Test materials viz. petroleum ether (PE), alkaloidal fraction (CH), acetone extracts (TAN) and mucilage (MM) (250 and 500 mg/kg, p.o.) obtained from M. macrantha bark were tested for membrane stabilizing, antinociceptive; anti inflammatory and Freund's complete adjuvant (FCA) induced arthritis activity. Diclofenac sodium and morphine were used as the reference standards in pharmacological assay. Test materials have significantly (p<0.01) inhibited paw edema after Carrageenan and histamine induction at higher doses. Administration of test materials of M. macrantha (250 and 500 mg/kg b.w.) significantly reduced abdominal writhing, formalin nociception, cotton pellet granuloma and vascular permeability in experimental animal. In addition to this, bark of M. macrantha showed chronic anti-rheumatic effect by suppressing the swelling volume, arthritis index, hematological and biochemical parameters (ESR, RA factor, CRP, liver transferase enzyme) in FCA-induced arthritis. It also significantly inhibited protein denaturation, heat-induced haemolysis of RBC and reduction in total leukocyte migration. Bioassay guided fractionation of the pet. ether extract of bark of M. macrantha led to isolation and characterization of β-sitosterol and stigma sterol confirmed by its HPLC, NMR and GC-MS study. In conclusion, extracts of M. macrantha bark can be explored as a therapeutic agent for the treatment of acute and chronic arthritis.