The pathogenesis of psoriasis involves hyperproliferation of epidermal keratinocytes and abnormal interactions between activated keratinocytes and infiltrating immune cells. Emerging evidence has shown that keratinocytes play essential roles in both the initiation and maintenance of psoriasis, suggesting that exposing keratinocytes to agents with antiproliferative and anti-inflammatory effects may be effective for psoriasis treatment. Guggulsterone (GS), a plant sterol derived from the gum resin of Commiphora wightii, possesses a variety of pharmacological activities. However, the effects of GS on psoriasis and the underlying mechanism have not been elucidated. In this study, we evaluated the therapeutic effect of GS on psoriasis using an imiquimod-induced psoriasis mouse model and investigated the effect of GS on human keratinocytes and the underlying mechanism. We found that GS effectively alleviated psoriasis-like skin lesions in imiquimod-induced psoriasis model mice and that GS suppressed the proliferation, migration, and production of proinflammatory cytokines, chemokines and antimicrobial peptides in keratinocytes. Transcriptome analysis by RNA-seq revealed that the differentially expressed genes (DEGs) induced by GS in keratinocytes were intricately linked to the pathogenesis of psoriasis. Furthermore, STAT3, a key player in the development and pathogenesis of psoriasis, was identified as a critical downstream mediator of GS in keratinocytes. Mechanistically, GS upregulated the expression of miR-17-5p, which directly binds to the 3'-untranslated regions (3'UTRs) of JAK1 and STAT3, leading to the downregulation of JAK1 and STAT3 expression. Collectively, these findings suggest that GS may serve as an effective natural compound for the treatment of psoriasis.