Expression of the pro-inflammatory cytokine interleukin-1 beta (IL-1beta) is increased following the nervous system injury. Generally IL-1beta induces inflammation, leading to neural degeneration, while several neuropoietic effects have also been reported. Although neurite outgrowth is an important step in nerve regeneration, whether IL-1beta takes advantages on it is unclear. Now we examine how it affects neurite outgrowth. Following sciatic nerve injury, expression of IL-1beta is increased in Schwann cells around the site of injury, peaking 1 day after injury. In dorsal root ganglion (DRG) neurons and cerebellar granule neurons (CGNs), neurite outgrowth is inhibited by the addition of myelin-associated glycoprotein (MAG), activating RhoA. IL-1beta overcomes MAG-induced neurite outgrowth inhibition, by deactivating RhoA. Intracellular signaling experiments reveal that p38 MAPK, and not nuclear factor-kappa B (NF-kappaB), mediated this effect. These findings suggest that IL-1beta may contribute to nerve regeneration by promoting neurite outgrowth following nerve injury.