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Influenza virus infection is a global public health issue. The efficacy of antiviral agents for influenza virus has been limited by the emergence of drug-resistant virus strains. Thus, there is an urgent need to identify novel antiviral therapies. Our previous studies have found that Cryptoporus volvatus extract can potently inhibit influenza virus replication in vitro and in vivo. However, the effective component of Cryptoporus volvatus, which mediates the antiviral activity, hasn't been identified. Here, we identified a novel anti-influenza virus molecule, Cryptoporic acid E (CAE), from Cryptoporus volvatus. Our results showed that CAE had broad-spectrum anti-influenza activity against 2009 pandemic strain A/Beijing/07/2009 (H1N1/09pdm), seasonal strain A/Beijing/CAS0001/2007(H3N2), mouse adapted strains A/WSN/33 (H1N1), and A/PR8/34 (H1N1). We further investigated the mode of CAE action. Time-course-analysis indicated that CAE exerted its inhibition mainly at the middle stages of the replication cycle of influenza virus. Subsequently, we confirmed that CAE inhibited influenza virus RNA polymerase activity and blocked virus RNA replication and transcription in MDCK cells. In addition, we found that CAE also impaired influenza virus infectivity by directly targeting virus particles. Our data suggest that CAE is a major effective component of Cryptoporus volvatus.Cryptoporic acid E (CAE) from Cryptoporus volvatus inhibits IAV replication.CAE reduces IAV RNA polymerase activity.CAE impairs IAV infectivity directly.