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Background and Purpose: Atopic dermatitis is a common chronic pruritic inflammatory disease of the skin involving neuro‐immune communication. Neuronal mechanism‐based therapeutic treatments remain lacking. We investigated the efficacy of intravenous lidocaine therapy on atopic dermatitis and the underlying neuro‐immune mechanism. Experimental Approach: Pharmacological intervention, immunofluorescence, RNA‐sequencing, genetic modification and immunoassay were performed to dissect the neuro‐immune basis of itch and inflammation in atopic dermatitis‐like mouse model and in patients. Key Results: Lidocaine alleviated skin lesions and itch in both atopic dermatitis patients and calcipotriol (MC903)‐induced atopic dermatitis model by blocking subpopulation of sensory neurons. QX‐314, a charged NaV blocker that enters through pathologically activated large‐pore ion channels and selectivity inhibits a subpopulation of sensory neurons, has the same effects as lidocaine in atopic dermatitis model. Genetic silencing NaV1.8‐expressing sensory neurons was sufficient to restrict cutaneous inflammation and itch in the atopic dermatitis model. However, pharmacological blockade of TRPV1‐positive nociceptors only abolished persistent itch but did not affect skin inflammation in the atopic dermatitis model, indicating a difference between sensory neuronal modulation of skin inflammation and itch. Inhibition of activity‐dependent release of calcitonin gene‐related peptide (CGRP) from sensory neurons by lidocaine largely accounts for the therapeutic effect of lidocaine in the atopic dermatitis model. Conclusion and Implications: NaV1.8+ sensory neurons play a critical role in pathogenesis of atopic dermatitis and lidocaine is a potential anti‐inflammatory and anti‐pruritic agent for atopic dermatitis. A dissociable difference for sensory neuronal modulation of skin inflammation and itch contributes to further understanding of pathogenesis in atopic dermatitis. [ABSTRACT FROM AUTHOR]