In order to access the suppressive effects of piroxicam (PX) and hydrolyzed products of Scutellariae Radix (PSH) on arthritis, we investigated whether PSH gel could suppress the progression of collagen-induced arthritis. PX, one of nonsteroidal anti-inflammatory drugs has been used in the systemic and topical treatment in a variety of inflammatory conditions. Scutellariae Radix, one of the herbal medicines, was used for the purpose of anti-inflammatory and anti-bacterials. For the purpose of transdermal absorption of the hydrogel preparations, two classes of hydrogels (PX, PSH) were formulated with carbomer 940, diethylene glycol monoethyl ether, polyethylene glycol-8-glyceryl caprylate/caprate and triethanolamine. In carrageenan-induced edema in rat hind paws, inhibition of foot swelling was more increased in PSH than PX hydrogel. Rheumatoid factors including serum IgG, IgM and collagen specific antibody were present much lower in PSH gel treated mice than control. Histological examination revealed that PSH hydrogel inhibited infiltration of inflammatory cells into affected paw joint, compared with control. The PSH hydrogel would be a suitable preparation to increase transdermal treatment for anti-inflammatory effects on collagen-induced arthritis.