The STAT3 transcription factor is critical for cytokine signaling and the acute phase response, but its role in allergic asthma is largely undefined. To investigate the role of STAT3 in mediating allergic inflammation, we used chemical and genetic approaches to inactivate STAT3 in the airway epithelium of mice. In a murine model of chronic asthma, we demonstrate that the administration of house dust mite (HDM) leads to robust STAT3 activation in the airway epithelium, smooth muscle, and immune cells in the lungs of C57BL/6 mice. To investigate the role of STAT3 in HDM-induced airway inflammation, a conditional knockout of STAT3 in the airway epithelium was generated, e-STAT3−/−. We determined that e-STAT3−/− mice had a significant decrease in HDM-induced airway eosinophilia, lung Th2 accumulation, and chemokines compared with wild-type animals. Importantly, the e-STAT3−/− mice had a significant decrease in airway hyperresponsiveness to methacholine. The administration of two STAT kinase inhibitors diminished STAT3 activation and markedly abrogated the HDM-induced lung inflammation. These findings suggest that STAT3 acts as a novel epithelial regulator of the allergic response by altering Th2 cell recruitment and effector function, and thus, targeting this molecule may provide the basis for a novel asthma therapy.