Antimicrobial peptides (AMPs) are host-defense agents capable of both bacterial membrane disruption and immunomodulation. However, the development of natural AMPs as potential therapeutics is hampered by their moderate activity and susceptibility to protease degradation. Herein we report lipidated cyclic γ-AApeptides that have potent antibacterial activity against clinically relevant Gram-positive and Gram-negative bacteria, many of which are resistant to conventional antibiotics. We show that lipidated cyclic γ-AApeptides mimic the bactericidal mechanism of AMPs by disrupting bacterial membranes. Interestingly, they also harness the immune response and inhibit lipopolysaccharide (LPS) activated Toll-like receptor 4 (TLR4) signaling, suggesting that lipidated cyclic γ-AApeptides have dual roles as novel antimicrobial and anti-inflammatory agents.