Synovial inflammation plays a key role in osteoarthritis (OA) pathogenesis. Fibroblast-like synoviocytes (FLSs) represent a distinct cell subpopulation within the synovium, and their unique phenotypic alterations are considered significant contributors to inflammation and fibrotic responses. The underlying mechanism by which acetyl-11-keto-β-boswellic acid (AKBA) modulates FLS activation remains unclear. This study aims to assess the beneficial effects of AKBA through both in vitro and in vivo investigations. Network pharmacology evaluation is used to identify potential targets of AKBA in OA. We evaluate the effects of AKBA on FLSs activation in vitro and the regulatory role of AKBA on the Nrf2/HO-1 signaling pathway. ML385 (an Nrf2 inhibitor) is used to verify the binding of AKBA to its target in FLSs. We validate the in vivo efficacy of AKBA in alleviating OA using anterior cruciate ligament transection and destabilization of the medial meniscus (ACLT+DMM) in a rat model. Network pharmacological analysis reveals the potential effect of AKBA on OA. AKBA effectively attenuates lipopolysaccharide (LPS)-induced abnormal migration and invasion and the production of inflammatory mediators, matrix metalloproteinases (MMPs), and reactive oxygen species (ROS) in FLSs, contributing to the restoration of the synovial microenvironment. After treatment with ML385, the effect of AKBA on FLSs is reversed. In vivo studies demonstrate that AKBA mitigates synovial inflammation and fibrotic responses induced by ACLT+DMM in rats via activation of the Nrf2/HO-1 axis. AKBA exhibits theoretical potential for alleviating OA progression through the Nrf2/HO-1 pathway and represents a viable therapeutic candidate for this patient population.