ADAR1 (adenosine deaminase acting on double-stranded RNA 1) is an RNA-editing enzyme that mediates adenosine-to-inosine RNA editing events, an important post-transcriptional modification mechanism that can alter the coding properties of mRNA or regulate microRNA biogenesis. ADAR1 also regulates the innate immune response. Here, we have demonstrated that ADAR1 expression increased in LPS-stimulated macrophages. Silencing ADAR1 by using small interfering RNA in macrophages resulted in the pronounced polarization of macrophages to M1, whereas ADAR1 overexpression promoted M2 polarization, which indicated that ADAR1 can inhibit macrophage hyperpolarization and prevent immune hyperactivity. The RNA-RNP immunoprecipitation binding assay demonstrated a direct interaction between ADAR1 and miR-21 precursor. Significant up-regulation in IL-10 and down-regulation in miR-21 were observed in ADAR1-overexpressing macrophages. We evaluated miR-21 target mRNAs and macrophage polarization signaling pathways and found that forkhead box protein O1 (Foxo1) was up-regulated in cells that overexpressed ADAR1. In a mouse allogeneic skin transplantation model, grafts in the ADAR1-overexpressed group survived longer and suffered less immune cell infiltration. In ADAR1-overexpressed recipients, splenic macrophages were significantly polarized to M2, and levels of sera IL-10 were markedly higher than those in the control group. In summary, ADAR1 modulates macrophage M2 polarization via the ADAR1-miR-21-Foxo1-IL-10 axis, thereby suppressing allogeneic graft rejection.-Li, J., Xie, J., Liu, S., Li, X., Zhang, D., Wang, X., Jiang, J., Hu, W., Zhang, Y., Jin, B., Zhuang, R., Yin, W. ADAR1 attenuates allogeneic graft rejection by suppressing miR-21 biogenesis in macrophages and promoting M2 polarization.