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As the primary innate immune cells of the brain, microglia respond to damage and disease through pro-inflammatory release of cytokines and neuroinflammatory molecules. Histone acetylation is an activating transcriptional mark that regulates inflammatory gene expression. Inhibition of histone deacetylase 3 (Hdac3) has been utilized in pre-clinical models of depression, stroke, and spinal cord injury to improve recovery following injury, but the molecular mechanisms underlying Hdac3's regulation of inflammatory gene expression in microglia is not well understood. To address this lack of knowledge, we examined how pharmacological inhibition of Hdac3 in an immortalized microglial cell line (BV2) impacted histone acetylation and gene expression of pro- and anti-inflammatory genes in response to immune challenge with lipopolysaccharide (LPS). Flow cytometry and cleavage under tags & release using nuclease (CUT & RUN) revealed that Hdac3 inhibition increases global and promoter-specific histone acetylation, resulting in the release of gene repression at baseline and enhanced responses to LPS. Hdac3 inhibition enhanced neuroprotective functions of microglia in response to LPS through reduced nitric oxide release and increased phagocytosis. The findings suggest Hdac3 serves as a regulator of microglial inflammation, and that inhibition of Hdac3 facilitates the microglial response to inflammation and its subsequent clearing of debris or damaged cells. Together, this work provides new mechanistic insights into therapeutic applications of Hdac3 inhibition which mediate reduced neuroinflammatory insults through microglial response.