IL-37 is a fundamental inhibitor of innate immunity. Human IL-37 has a caspase-1 cleavage site and translocates to the nucleus upon LPS stimulation. Here, we investigated whether caspase-1 processing affects IL-37-mediated suppression of LPS-induced cytokines and the release from cells by analyzing a caspase-1 cleavage site mutant IL-37 (IL-37D20A). Nuclear translocation of IL-37D20A is significantly impaired compared with WT IL-37 in transfected cells. LPS-induced IL-6 was decreased in cells expressing WT IL-37 but not IL-37D20A. The function of IL-37 in transfected bone marrow-derived macrophages is nucleotide-binding oligomerization domain-like receptor family, pyrin domain containing 3 (NLRP3) inflammasome-dependent, because IL-37 transfection in apoptosis-associated speck-like protein containing a carboxyl-terminal caspase recruitment domain- and NLRP3-deficient cells does not reduce levels of IL-6 and IL-1β upon LPS stimulation. IL-37-expressing macrophages release both precursor and mature IL-37, but only the externalization of mature IL-37 was dependent on ATP. Precursor and mature IL-37 was also secreted from human dendritic cells and peripheral blood mononuclear cells. To determine whether IL-37 is active in the extracellular compartment, we pretreated IL-37 transgenic mice with IL-37-neutralizing antibodies before LPS challenge. In IL-37-expressing mice, neutralizing IL-37 antibodies reversed the suppression of LPS-induced serum IL-6. In contrast, the addition of neutralizing antibody did not reverse suppression of LPS-induced IL-6 in mouse macrophages transfected with IL-37. Although caspase-1 is required for nuclear translocation of intracellular IL-37 and for secretion of mature IL-37, the release of the IL-37 precursor is independent of caspase-1 activation. IL-37 now emerges as a dual-function cytokine with intra- and extracellular properties for suppressing innate inflammation.