Propolis is a resinous substance collected by honeybees from leaf buds and cracks in the bark of various plants. Propolis has been reported to have immunomodulatory activity. We hypothesized that propolis would be able to reduce the disease severity of rheumatoid arthritis. We evaluated the effect of Brazilian propolis ethanolic extract on the pathogenesis of collagen-induced arthritis (CIA) in mice. Mice fed propolis exhibited significant lower clinical arthritis scores than those fed the control diet. To investigate the mechanism of the effect of propolis on CIA mice, we examined interleukin-17 (IL-17) production in CIA mice fed propolis using an enzyme-linked immunospot assay and flow cytometric analysis. The numbers of IL-17-producing cells in the CIA mice fed propolis were significantly decreased. To determine direct influence of propolis on cytokine production, splenocytes were stimulated with phorbol myristate acetate in the presence of propolis extract in vitro. Concentration-dependent declines in IL-17 expression were observed by ELISA and real-time PCR methods. We further found that propolis significantly inhibited the differentiation of Th17 cells from murine splenocytes in a concentration-dependent manner. Taken together, our results may provide a new light on the potential mechanism of the immunosuppressive and anti-inflammatory effects of propolis.