Carbon monoxide (CO) dampens pro-inflammatory responses in a peroxisome proliferator-activated receptor-γ (PPARγ) and p38 mitogen-activated protein kinase (MAPK) dependent manner. Previously, we demonstrated that CO inhibits lipopolysaccharide (LPS)-induced expression of the proinflammatory early growth response-1 (Egr-1) transcription factor in macrophages via activation of PPARγ. Here, we further characterize the molecular mechanisms by which CO modulates the activity of PPARγ and Egr-1 repression. We demonstrate that CO enhances SUMOylation of PPARγ which we find was attributed to mitochondrial ROS generation. Ectopic expression of a SUMOylation-defective PPARγ-K365R mutant partially abolished CO-mediated suppression of LPS-induced Egr-1 promoter activity. Expression of a PPARγ-K77R mutant did not impair the effect of CO. In addition to PPARγ SUMOylation, CO-activated p38 MAPK was responsible for Egr-1 repression. Blocking both CO-induced PPARγ SUMOylation and p38 activation, completely reversed the effects of CO on inflammatory gene expression. In primary macrophages isolated form C57/BL6 male mice, we identify mitochondrial ROS formation by CO as the upstream trigger for the observed effects on Egr-1 in part through uncoupling protein 2 (UCP2). Macrophages derived from bone marrow isolated from Ucp2 gene Knock-Out C57/BL6 mice (Ucp2(-/-)), produced significantly less ROS with CO exposure versus wild-type macrophages. Moreover, absence of UCP2 resulted in a complete loss of CO mediated Egr-1 repression. Collectively, these results indentify p38 activation, PPARγ-SUMOylation and ROS formation via UCP2 as a cooperative system by which CO impacts the inflammatory response.