Obese and sedentary persons have increased risk for cancer; inflammation is a hypothesized mechanism. We examined the effects of a caloric restriction weight loss diet and exercise on inflammatory biomarkers in 439 women. Overweight and obese postmenopausal women were randomized to 1-year: caloric restriction diet (goal of 10% weight loss, N=118), aerobic exercise (225 minutes/week of moderate-to-vigorous activity, N=117), combined diet+exercise (N=117) or control (N=87). Baseline and 1-year high-sensitivity C-reactive protein (hs-CRP), serum amyloid A (SAA), interleukin-6 (IL-6), leukocyte and neutrophil levels were measured by investigators blind to group. Inflammatory biomarker changes were compared using generalized estimating equations. Models were adjusted for baseline body mass index (BMI), race/ethnicity and age. 438 (N=1 in diet+exercise group was excluded) were analyzed. Relative to controls, hs-CRP decreased by geometric mean (95% confidence interval, p-value) 0.92mg/L (0.53–1.31, P<0.001) in the diet and 0.87mg/L (0.51–1.23, P<0.0001) in the diet+exercise groups. IL-6 decreased by 0.34pg/ml (0.13–0.55, P=0.001) in the diet and 0.32pg/ml (0.15–0.49, P<0.001) in the diet+exercise groups. Neutrophil counts decreased by 0.31×109/L (0.09–0.54, P=0.006) in the diet and 0.30×109/L (0.09–0.50, P=0.005) in the diet+exercise groups. Diet and diet+exercise participants with ≥5% weight loss reduced inflammatory biomarkers (hs-CRP, SAA, and IL-6) compared to controls. The diet and diet+exercise groups reduced hs-CRP in all subgroups of baseline BMI, waist circumference, CRP level, and fasting glucose. Our findings indicate that a caloric restriction weight loss diet with or without exercise reduces biomarkers of inflammation in postmenopausal women, with potential clinical significance for cancer risk reduction.