Many studies have suggested that the synergic effect of myeloid differential protein-2 (MD-2) on bacterial lipopolysaccharide (LPS) stimulation of toll-like receptor 4 (TLR4) may be a critical step during the LPS-TLR4 response signaling pathway. We performed a bioinformatic analysis on the MD-2 protein and identified the amino acid sequence NH2-FSKGKYKCV-COOH (K128-132) as a possible key sequence involved in the binding between MD-2 and LPS. We then screened a random phage display peptide library using this sequence as bait in order to identify antagonistic peptides. After 3 rounds of selection, 3 positive clones were identified. All 3 peptides were shown to inhibit, in a dose-dependent manner the production of tumor necrosis factor-α and interleukin-6 in human U937 and THP-1 cell lines as well as human peripheral blood monocytes stimulated by LPS. Only 2 of the 3 peptides were able to bind MD-2 directly as shown by sulfo-SBED biotin label transfer experiments. BALB/C mice were used to estimate the protection of these peptides from LPS challenge, and 2 of the 3 peptides (Lys-Thr-Val-Pro-Asp-Asn-His and Ile-Gly-Lys-Phe-Leu-Tyr-Arg) reduced mortality of the challenged mice from 100% to 53.8%. This study has demonstrated that interfering with the binding between MD-2 and LPS might be a potential therapeutic strategy for treating LPS-induced sepsis, and in doing so has identified 2 potential peptide candidates.