Careya arborea Roxb. (Lecythidaceae) has multiple applications in traditional medicine; it exhibits analgesic, antibacterial, anti-inflammatory, antiulcer, and protective effects. However, the effect of C. arborea on biochemical and immmunological inflammatory mediators has not been explored. The present study investigates the anti-inflammatory potential of the methanol extract of C. arborea stem bark and further assesses its possible mechanism on the modulation of inflammatory biomarkers. Anti-inflammatory activity of C. arborea methanol extract (CAME) was evaluated (100 and 200 mg/kg, p.o) using indomethacin (10 mg/kg, p.o) as the standard drug in Wistar albino rats. Inflammation was induced by injecting 0.1 ml carrageenan (1% w/v) into the left hind paw. The anti-inflammatory mechanism was studied by measuring malondialdehyde (MDA), C-reactive protein (CRP), nitric oxide (NO), myeloperoxidase (MPO), TNF-α, and IL-1β levels in both control and treated groups. A protocol has also been established to quantify quercetin and betulinic acid content in CAME using HPTLC fingerprint. Careya arborea significantly (p < 0.001) decreased carrageenan-induced paw edema, showed a reduction of 48.87 and 65.53% at doses of 100 and 200 mg/kg, respectively. Moreover, CAME significantly decreased the MDA, CRP, NO, and MPO levels, elevated by carrageenan induced inflammation. CAME also markedly down-regulated serum TNF-α and IL-1β levels. These findings were further supported by the histological study. The content of quercetin and betulinic acid in CAME was found to be 0.177 and 3.14%, respectively. Several mechanisms, including the inhibition of pro-inflammatory cytokines, enzymes and mediators release, appear to account for the anti-inflammatory potential of C. arborea.