Neuroinflammation is a key process for many neurodegenerative diseases. Activated microglia and astrocytes play an essential role in neuroinflammation by producing nitric oxide (NO), inflammatory cytokines, chemokines, and neurotoxins. Therefore, targeting glia-mediated neuroinflammation using small-molecules is a potential therapeutic strategy. In this study, we performed a phenotypic screen using microglia cell-based assay to identify a hit compound containing N-carbamoylated urethane moiety (SNU-BP), which inhibits lipopolysaccharide (LPS)-induced NO production in microglia. SNU-BP inhibited pro-inflammatory cytokines and inducible nitric oxide synthase in LPS-stimulated microglia, and potentiated interleukin-4-induced arginase-1 expression. PPAR-γ was identified as a molecular target of SNU-BP. The PPAR response element reporter assay revealed that SNU-BP specifically activated PPAR-γ, but not PPAR-δ or -α, confirming that PPAR-γ is the target protein of SNU-BP. The anti-inflammatory effect of SNU-BP was attenuated by genetic and pharmacological inhibition of PPAR-γ. In addition, SNU-BP induced an anti-inflammatory phenotype in astrocytes as well, by inhibiting pro-inflammatory NO and TNF-α, while increasing anti-inflammatory genes, such as arginase-1 and Ym-1. Finally, SNU-BP exhibited an anti-inflammatory effect in the LPS-injected mouse brain, demonstrating a protective potential for neuroinflammatory diseases.