Prostaglandins, including PGD₂ and PGE₂, are produced during allergic reactions. Although PGD₂ is an important mediator of allergic responses, aspirin-like drugs that inhibit prostaglandin synthesis are generally ineffective in allergic disorders, suggesting that another prostaglandin-mediated pathway prevents the development of allergic reactions. Here we show that such a pathway may be mediated by PGE₂ acting at the prostaglandin E receptor EP3. Mice lacking EP3 developed allergic inflammation that was much more pronounced than that in wild-type mice or mice deficient in other prostaglandin E receptor subtypes. Conversely, an EP3-selective agonist suppressed the inflammation. This suppression was effective when the agonist was administered 3 h after antigen challenge and was associated with inhibition of allergy-related gene expression. Thus, the PGE₂-EP3 pathway is an important negative modulator of allergic reactions.