Aims: We asked whether the neuroprotective effect of cholinergic microglial stimulation during an ischemic event acts via a mechanism involving the activation of nuclear factor erythroid-2-related factor 2 (Nrf2) and/or the expression of its target cytoprotective gene, heme oxygenase-1 (HO-1). Specifically, the protective effect of the pharmacologic alpha-7 nicotinic acetylcholine receptor (α7 nAChR) agonist PNU282987 was analyzed in organotypic hippocampal cultures (OHCs) subjected to oxygen and glucose deprivation (OGD) in vitro as well as in photothrombotic stroke in vivo. Results: OHCs exposed to OGD followed by reoxygenation elicited cell death, measured by propidium iodide and 3-(4,5-Dimethylthiazol-2-yl)-2,5-diphenyltetrazolium bromide staining. Activation of α7 nAChR by PNU282987, after OGD, reduced cell death, reactive oxygen species production, and tumor necrosis factor release. This was associated with induction of HO-1 expression, an effect reversed by α-bungarotoxin and by tin–protoporphyrin IX. The protective effect of PNU282987 was lost in microglial-depleted OHCs as well as in OHCs from Nrf2-deficient-versus-wild-type mice, an effect associated with suppression of HO-1 expression in microglia. Administration of PNU282987 1 h after induction of photothrombotic stroke in vivo reduced the infarct size and improved motor skills in Hmox1^lox/lox mice that express normal levels of HO-1, but not in LysM^CreHmox1^Δ/Δ in which HO-1 expression is inhibited in myeloid cells, including the microglia. Innovation: This study suggests the participation of the microglial α7 nAChR in the brain cholinergic anti-inflammatory pathway. Conclusion: Activation of the α7 nAChR/Nrf2/HO-1 axis in microglia regulates neuroinflammation and oxidative stress, affording neuroprotection under brain ischemic conditions. Antioxid. Redox Signal. 19, 1135–1148.