A large number of prevalent lung diseases is associated with tissue inflammation. Clinically, corticosteroid therapies are applied systemically or via inhalation for the treatment of lung inflammation, and a number of novel therapies are being developed that require preclinical testing. In alveoli, macrophages and dendritic cells play a key role in initiating and diminishing pro-inflammatory reactions and, in particular, macrophage plasticity (M1 and M2 phenotypes shifts) has been reported to play a significant role in these reactions. Thus far, no studies with in vitro lung epithelial models have tested the comparison between systemic and direct pulmonary drug delivery. Therefore, the aim of this study was to develop an inflamed human alveolar epithelium model and to test the resolution of LPS-induced inflammation in vitro with a corticosteroid, methylprednisolone (MP). A specific focus of the study was the macrophage phenotype shifts in response to these stimuli. First, human monocyte-derived macrophages were examined for phenotype shifts upon exposure to lipopolysaccharide (LPS), followed by treatment with MP. A multicellular human alveolar model, composed of macrophages, dendritic cells, and epithelial cells, was then employed for the development of inflamed models. The models were used to test the anti-inflammatory potency of MP by monitoring the secretion of pro-inflammatory mediators (interleukin [IL]-8, tumor necrosis factorα [TNF-α], and IL-1β) through four different approaches, mimicking clinical scenarios of inflammation and treatment. In macrophage monocultures, LPS stimulation shifted the phenotype towards M1, as demonstrated by increased release of IL-8 and TNF-α and altered expression of phenotype-associated surface markers (CD86, CD206). MP treatment of inflamed macrophages reversed the phenotype towards M2. In multicellular models, increased pro-inflammatory reactions after LPS exposure were observed, as demonstrated by protein secretion and gene expression measurements. In all scenarios, among the tested mediators the most pronounced anti-inflammatory effect of MP was observed for IL-8. Our findings demonstrate that our inflamed multicellular human lung model is a promising tool for the evaluation of anti-inflammatory potency of drug candidates in vitro. With the presented setup, our model allows a meaningful comparison of the systemic vs. inhalation administration routes for the evaluation of the efficacy of a drug in vitro.