Cordyceps militaris is a rare and exotic medicinal mushroom used in traditional Chinese medicine. The secondary metabolite, cordycepin (3?-deoxyadenosine), produced from C. militaris is a biologically active compound. Cordycepin has been demonstrated to exert several pharmacological effects, such as anti-microbial and anti-tumor activities. However, the effect of cordycepin on the immune modulation of porcine alveolar macrophages (PAM) is poorly investigated. In the current study, we investigated the immunomodulatory effect of cordycepin from C. militaris hot water (CMHW) extract on lipopolysaccharide (LPS) simulated PAM. The CMHW significantly reduced LPS-stimulated nitric oxide production and cyclooxygenase-2 protein expression levels in a dose-dependent manner. The LPS-induced phosphorylation of p38 was impaired by CMHW treatment, thereby decreasing pro-inflammatory cytokine secretion, including tumor necrosis factor-α, interleukin-1β, and interleukin-6. Similar to CMHW, cordycepin also had similar effects on LPS-stimulated PAM. Taken together, these findings demonstrate that CMHW has an inhibitory effect on LPS-induced inflammatory responses in PAM through regulation of the p38 mitogen-activated protein kinase signaling pathway. Thus, CMHW is a potential novel feed additive for immunomodulation in farm animals.