Foot ulceration, if not treated properly, will eventually result in amputation. Inflammation may impede the wound healing process if not properly controlled. The root of Astragalus membranaceus (AR) is one of the Chinese herbs commonly found in Chinese herbal formulae used for treating foot ulcer. In this study, we aimed to identify the active fractions and/or compounds from AR aqueous extract, which are responsible for the anti-inflammatory effect using in vitro bioassay-guided fractionation. The anti-inflammatory effect was monitored by the inhibition of nitric oxide (NO) released from lipopolysaccharide-stimulated mouse macrophage RAW 264.7 cells after treated with AR aqueous extract or its fractions and isolated components. Two major active fractions (P2-3-2-2-2 and P2-3-2-2-3) were found to significantly inhibit NO production at 0.156 mg/mL (p < 0.01). In addition, three chemical components (formononetin, calycosin and astragaloside IV) were successfully isolated from P2-3-2-2-3. Only formononetin could significantly inhibit NO production (p < 0.01), whereas the other two components had no significant effects at concentrations ranging from 0.039 to 0.156 mg/mL. In conclusion, two major anti-inflammatory active fractions that may enhance wound healing were identified, and formononetin was one of the active ingredients in the active fractions. Copyright © 2012 John Wiley & Sons, Ltd.