Interleukin-27 is a pleiotropic cytokine that is involved in tissue responses to infection, cell stress, neuronal disease, and tumors. Recent studies in various tissues indicate that interleukin-27 has complex activating and inhibitory properties in innate and acquired immunity. The availability of recombinant interleukin-27 protein and mice with genetic deletions of interleukin-27, its receptors and signaling mediators have helped define the role of interleukin-27 in neurodegenerative diseases. Interleukin-27 has been well-characterized as an important regulator of T cell activation and differentiation that enhances or suppresses T cell responses in autoimmune conditions in the central nervous system. Evidence is also accumulating that interleukin-27 has neuroprotective activities in the retina and brain. Interleukin-27 is secreted from and binds to infiltrating microglia, macrophage, astrocytes, and even neurons and it promotes neuronal survival by regulating pro- and anti-inflammatory cytokines, neuroinflammatory pathways, oxidative stress, apoptosis, autophagy, and epigenetic modifications. However, interleukin-27 can have the opposite effect and induce inflammation and cell death in certain situations. In this review, we describe the current understanding of regulatory activities of interleukin-27 on cell survival and inflammation and discuss its mechanisms of action in the brain, spinal cord, and retina. We also review evidence for and against the therapeutic potential of interleukin-27 for dampening harmful neuroinflammatory responses in central nervous system diseases.