A chemical investigation on a South China Sea gorgonian, Menella sp. resulted in the isolation and elucidation of menellin A (1), a highly oxygenated racemate with C(8) skeleton, and a polyhydroxylated steroid, menellsteroid C (2), along with eight known compounds (3-10). The structures of the new compounds were elucidated by means of MS, 1D and 2D NMR spectra, and the relative stereochemistry of 1 was determined by X-ray single-crystal diffraction analysis. In addition, compound 7 was isolated as a new natural product. Compounds 1-3 and 7 were selected to test the anti-inflammatory inhibition against lipopolysaccharide (LPS)-induced nitric oxide (NO) production in RAW264.7 macrophages. 1 and 3 exhibited modest inhibitory effects with IC(50) of 71.3, 33.9 µM, respectively, compared to the positive control aminoguanidine (IC(50) 25.0 µM).