Neuroinflammation and oxidative stress underlie the pathogenesis of various neurodegenerative disorders. Here we demonstrate that sodium phenylbutyrate (NaPB), an FDA-approved therapy for reducing plasma ammonia and glutamine in urea cycle disorders, can suppress both proinflammatory molecules and reactive oxygen species (ROS) in activated glial cells. Interestingly, NaPB also decreased the level of cholesterol but involved only intermediates, not the end product of cholesterol biosynthesis pathway for these functions. While inhibitors of both geranylgeranyl transferase (GGTI) and farnesyl transferase (FTI) inhibited the activation of NF-κB, inhibitor of GGTI, but not FTI, suppressed the production of ROS. Accordingly, a dominant-negative mutant of p21(rac), but not p21(ras), attenuated the production of ROS from activated microglia. Inhibition of both p21(ras) and p21(rac) activation by NaPB in microglial cells suggests that NaPB exerts anti-inflammatory and antioxidative effects via inhibition of these small G proteins. Consistently, we found activation of both p21(ras) and p21(rac)in vivo in the substantia nigra of acute 1-methyl-4-phenyl-1,2,3,6-tetrahydropyridine (MPTP) mouse model of Parkinson's disease. Oral administration of NaPB reduced nigral activation of p21(ras) and p21(rac), protected nigral reduced glutathione, attenuated nigral activation of NF-κB, inhibited nigral expression of proinflammatory molecules, and suppressed nigral activation of glial cells. These findings paralleled dopaminergic neuronal protection, normalized striatal neurotransmitters, and improved motor functions in MPTP-intoxicated mice. Consistently, FTI and GGTI also protected nigrostriata in MPTP-intoxicated mice. Furthermore, NaPB also halted the disease progression in a chronic MPTP mouse model. These results identify novel mode of action of NaPB and suggest that NaPB may be of therapeutic benefit for neurodegenerative disorders.