This review explores the mechanisms of cytotoxic and anti‑inflammatory properties of andrographolide and derivatives of andrographolide in various cell lines. In vitro and in vivo studies that shed light on the molecular mechanisms of cytotoxicity and anti‑inflammatory property of andrographolide and its derivatives are reviewed here. Cytotoxic effect of andrographolide on cancer cell lines are mainly due to the induction of reactive oxygen species, activation of c‑Jun N‑terminal kinase, inhibition of autophagy, and induction of apoptosis. Anti‑inflammatory effect of andrographolide is predominantly due to the covalent inhibition of nuclear factor kappa B transcription factor and thereby inhibition of various targets genes such as tumor necrosis factor‑alpha, interleukin‑6, macrophage inflammatory protein‑2, and nitric oxide synthase. Andrographolide is known to directly bind Ras protein; therefore, inhibition of growth factor‑activated downstream pathways such as ERK1/2 pathway might be due to the direct inhibition of Ras functions. Inhibition of Ras pathway by antagonizing Ras protein might be a key event contributing to both cytotoxicity and anti‑inflammatory functions of andrographolide. Evidence from literature study showed that derivatives of andrographolide such as neoandrographolide and 14‑deoxy‑11,12‑didehydroandrographolides are potent anti‑inflammatory agents with less cytotoxicity. Unfavorable chemical modifications such as sulfation and glucuronidation inside the body and fast removal from plasma are the major factors known to hinder the bioavailability of andrographolide.