Ulcerative colitis is a chronic inflammatory disease caused by abnormal immune responses in the intestinal mucosa and gut microorganisms. Unlike other mugworts, Artemisia argyi H. (A. argyi H.) enhances antioxidant, anti-inflammatory, and anticancer effects, but the improvement effects against gut inflammation have not yet been reported. Therefore, this study aimed to confirm the alleviation of the inflammatory state in the gut by A. argyi H. fermented with Lactobacillus plantarum (FAA), using lipopolysaccharide (LPS)-induced RAW 264.7 cells and dextran sulfate sodium (DSS)-induced colitis models. In vitro, FAA (10, 50, 100, and 200 μg/mL) was pretreated into RAW 264.7 cells, followed with LPS (100 ng/mL), which induced the cell damage. Meanwhile, in vivo, FAA (100, 200 mg/kg/day) was orally administered into 6-week-old C57BL/6N mice for 3 weeks. During the last week of FAA administration, 2.5% DSS was used to induce colitis. The results showed that FAA reduced the production of nitric oxide (p < 0.0001), tumor necrosis factor (TNF)-α, interleukin (IL)-6 (p < 0.0001), and IL-1β (p < 0.0001) in the LPS-induced RAW 264.7 cells. Moreover, in the DSS-induced colitis model, FAA alleviated clinical symptoms (p < 0.001), inhibited the inflammatory state by reducing the production of TNF-α (p < 0.0001) and interferon-γ in intestinal immune cells (p < 0.0001), and strengthened the intestinal barrier by increasing the number of goblet cells (p < 0.0001). Furthermore, the anti-inflammatory effects were confirmed by the alleviation of histological damage (p < 0.001) and down-regulation of the expression of inflammatory proteins (TLR4, p < 0.0001; MyD88, p < 0.0001; Cox-2, p < 0.0001). These results suggest the potential of FAA as a dietary ingredient for preventing inflammation in the gut.