The present study addresses the neuroprotective function of intracerebroventricular (i.c.v.) application of pioglitazone, a selective ligand of the peroxisome proliferator‐activated receptor gamma (PPARγ) in the rat brain after ischaemia. Pioglitazone or vehicle were i.c.v. infused via osmotic minipumps over a 5‐day period before, and 2 days after transient middle cerebral artery occlusion (MCAO) for 90 min. This i.c.v. application of pioglitazone in the brain significantly reduced the infarct size and brain oedema, and attenuated in the peri‐infarct cortical regions the invasion of activated microglia and macrophages. Moreover, pioglitazone improved the recovery of sensory deficits 48 h after MCAO. Our data demonstrate for the first time that it is the activation of intracerebral PPARγ that can confer neuroprotection, anti‐inflammatory and neurological improvement following ischaemic injury.