Background: Chronic obstructive pulmonary disease is a progressive lung disease that involves airway inflammation, chronic bronchitis, and emphysema. Yukgunja-tang, one of the traditional Asian herbal medicines, has been used widely in treating patients with gastrointestinal diseases in Korea. Objective: Here, we investigated its efficacy on the inflammatory response using a mouse model of cigarette smoke (CS) exposure together with lipopolysaccharide (LPS) treatment. Materials and Methods: Over 4 weeks, mice were exposed to CS on 5 days/week and instilled intranasally with LPS on days 8 and 23. Yukgunja-tang water extract (YTWE) was administered to mice on the same 5 days. Results: YTWE administration significantly reduced the numbers of inflammatory cells and levels of pro-inflammatory cytokines in bronchoalveolar lavage fluid compared with CS plus LPS-exposed mice. Moreover, YTWE inhibited the phosphorylation of p38 mitogen-activated protein kinase (MAPK) and IκBα proteins induced by CS plus LPS treatment. Histologically, YTWE attenuated the infiltration of inflammatory cells into peribronchial lesions, thickening of alveolar walls and accumulation of collagen in the lung tissues. Conclusion: Our findings suggest that YTWE prevents CS plus LPS-induced lung inflammation by inhibiting p38 MAPK and IκBα signaling. Therefore, YTWE might be a potential drug for the treatment of lung inflammation induced by CS exposure.