Anoectochilus formosanus, a famous traditional Chinese medicine, has been used as a source of folk medicine alternative liver injury therapy. Here, we evaluate the hepatoprotective potential of water extract of Anoectochilus formosanus Hayata (WEAF). The cultured splenocytes and concanavalin A (ConA)-induced hepatitis model in mice were established to investigate the immunoregulation and hepatoprotection of WEAF. In vitro, WEAF inhibited the production of TNF-alpha, IFN-gamma and IL-4 in ConA-stimulated splenocytes. In vivo, mice pretreated with WEAF followed by ConA challenge showed reduction of liver damage. Pre-treatment with WEAF significantly decreased transaminase levels and hepatocyte apoptosis in ConA-injected mice. WEAF possessed potent anti-inflammatory and hepatoprotective activity. WEAF attenuated hepatic inflammation via up-regulation of IL-10 and down-regulation of TNF-alpha, IFN-gamma, IL-4 and IL-6. Furthermore, WEAF ameliorated the intrahepatic infiltration of CD4(+)T and CD8(+)T cells, decreased the iNOS expression, as well as inhibited nuclear factor kappa B (NF kappa B) activation and Toll-like receptor 4 (TLR4) expression. Our findings provided evidences that WEAF had great potential to develop new immunomodulatory agent to treat immune-mediated hepatitis.