Caspase-8 functions at the crossroad of programmed cell death and inflammation. Here, using genetic approaches and the experimental autoimmune encephalomyelitis model of inflammatory demyelination, we identified a negative regulatory pathway for caspase-8 in infiltrated macrophages whereby it functions to restrain interleukin (IL)-1β-driven autoimmune inflammation. Caspase-8 is partially activated in macrophages/microglia in active lesions of multiple sclerosis. Selective ablation of in myeloid cells, but not microglia, exacerbated autoimmune demyelination. Heightened IL-1β production by caspase-8-deficient macrophages underlies exacerbated activation of encephalitogenic T cells and production of GM-CSF and interferon-γ. Mechanistically, IL-1β overproduction by primed caspase-8-deficient macrophages was mediated by RIPK1/RIPK3 through the engagement of NLRP3 inflammasome and was independent of cell death. When instructed by autoreactive CD4 T cells in the presence of antigen, caspase-8-deficient macrophages, but not their wild-type counterparts, released significant amount of IL-1β that in turn acted through IL-1R to amplify T cell activation. Moreover, the worsened experimental autoimmune encephalomyelitis progression in myeloid mutant mice was completely reversed when was simultaneously deleted. Together, these data reveal a functional link between T cell-driven autoimmunity and inflammatory IL-1β that is negatively regulated by caspase-8, and suggest that dysregulation of the pathway may contribute to inflammatory autoimmune diseases, such as multiple sclerosis.