While psoriasis is one of the most common skin disorders in humans, effective, safe and inexpensive treatments are still largely unavailable. Chinese herbal medicine (CHM) has been used for centuries for treating psoriasis and several reports claim that systemic administration of one such CHM, Tuhuai, mainly composed of flos sophorae, smilax glabra roxb and licorice, is effective in psoriasis. However, the mechanisms by which this CHM improves psoriasis are not yet clear. Two universal features of psoriasis are epidermal hyperplasia and inflammation. Moreover, drugs that specifically inhibit epidermal hyperplasia and/or inflammation are widely used to treat psoriasis. Here, we investigated whether topical applications of Tuhuai extract exhibit anti-proliferative and anti-inflammatory activities in two murine models of inflammatory dermatoses. To assess Tuhuai's potential anti-proliferative effect, we disrupted epidermal barrier function twice-daily for 4 days in normal hairless mice followed by topical applications of either 1% Tuhuai extract or Vehicle to both flanks immediately after each barrier perturbation. Changes in epidermal proliferation and apoptosis were evaluated by immunohistochemistry and TUNEL staining. To assess the anti-inflammatory effects of Tuhuai, both irritant (phorbol ester) and acute allergic contact dermatitis (oxazolone) models were used. Whereas topical Tuhuai extract did not alter epidermal proliferation or induce irritation in normal skin, it both reduced epidermal hyperplasia in the epidermal hyperproliferative model, and reduced inflammation in both irritant and allergic contact dermatitis models. As topical Tuhuai extract exhibits anti-proliferative and anti-inflammatory properties in a variety of human models of inflammatory dermatoses, Tuhuai could provide an effective, relatively safe and inexpensive therapeutic alternative for the treatment of inflammatory dermatoses, including psoriasis.