IL-22 is a relatively new cytokine that is characterized by several unique biological properties. In the intestines, the effect of IL-22 is restricted mainly to non-lymphoid cells such as epithelial cells. Interestingly, the expression pattern and major cellular source of IL-22 have distinct difference between large and small intestines. IL-22 possesses an ability to constitutively activate STAT3 for promoting epithelial cell regeneration and reinforcing mucosal barrier integrity through stimulating the expression of anti-bacterial peptide and mucins. Of note, IL-22 is characterized as a two-faced cytokine that can play not only protective but also deleterious roles in the intestinal inflammation depending on the cytokine environment such as the expression levels of IL-23, T-bet, and IL-22 binding protein. Most importantly, clinical relevance of IL-22 to inflammatory bowel disease has been well highlighted. Mucosal healing, which represents the current therapeutic goal for IBD, can be induced by IL-22. Indeed, indigo naturalis, which can activate IL-22 pathway through Ahr, has been shown in a clinical trial to exhibit a strong therapeutic effect on ulcerative colitis. Despite the beneficial effect of IL-22, continuous activation of the IL-22 pathway increases the risk of colitis-associated cancer, particularly in patients with an extended history of IBD. This review article discusses how IL-22 regulates colitis, how beneficial versus deleterious effects of IL-22 is determined, and why IL-22 represents a promising target for IBD therapy.