Madecassoside (MA), a pentacyclic triterpene isolated from Centella asitica (L.), is used as a therapeutic agent in wound healing and also as an anti-inflammatory and anti-aging agent. However, the involvement of MA in skin-pigmentation has not been reported. This study was conducted to investigate the effects of MA on ultraviolet (UV)-induced melanogenesis and mechanisms in a co-culture system of keratinocytes and melanocytes. MA significantly inhibited UVR-induced melanin synthesis and melanosome transfer in the co-culture system. These effects were further demonstrated by the MA-induced inhibition of protease-activated receptor-2 expression and its signaling pathway, cyclooxygenase-2, prostaglandin E2 and prostaglandin F2 alpha in keratinocytes. The clinical efficacy of MA was confirmed on artificially tanned human skin. MA significantly reduced UV-induced melanin index at 8 weeks after topical application. Overall, the study demonstrated significant benefits of MA use in the inhibition of hyperpigmentation caused by UV irradiation.