Aurisin A (AA), an aristolane dimer sesquiterpene isolated from the luminescent mushroom Neonothopanus nambi, exhibits various biological and pharmacological effects. However, its poor solubility limits its use for further medicinal applications. This study aimed to improve the water solubility of AA via complexation with β-cyclodextrin (βCD) and its derivatives (2,6-di-O-methyl-βCD (DMβCD) and 2-hydroxypropyl-βCD (HPβCD). A phase solubility analysis demonstrated that the solubility of AA linearly enhanced with increasing concentrations of βCDs (ranked in the order of AA/DMβCD > AA/HPβCD > AA/βCD). Notably, βCDs, especially DMβCD, increased the thermal stability of the inclusion complexes. The thermodynamic study indicated that the complexation between AA and βCD(s) was a spontaneous endothermic reaction, and AA/DMβCD possesses the highest binding strength. The complex formation between AA and DMβCD was confirmed by means of FT-IR, DSC, and SEM. Molecular dynamics simulations revealed that the stability and compactness of the AA/DMβCD complex were higher than those of the DMβCD alone. The encapsulation of AA led to increased intramolecular H-bond formations on the wider rim of DMβCD, enhancing the complex stability. The antiproliferative activity of AA against A549 and H1975 lung cancer cells was significantly improved by complexation with DMβCD. Altogether, the satisfactory water solubility, high thermal stability, and enhanced antitumor potential of the AA/DMβCD inclusion complex would be useful for its application as healthcare products or herbal medicines.