FK506 binding protein 5 (FKBP5) is a peptidyl propyl cis-trans isomerase that has been shown to interact with cellular immune pathways such as calcineurin and NF-κB. During an influenza infection, FKBP5 is up-regulated at the lung in an in vivo ferret infection model, yet the effect of FKBP5 on influenza replication and immune response is not understood. An in vitro model of human alveolar epithelial cell line A549 was established to study the cause and the function of FKBP5 up-regulation during an influenza infection. In this in vitro model, FKBP5 was not up-regulated by influenza replication, but instead it was up-regulated when A549 cells were treated with glucocorticoid. FKBP5 up-regulation did not have any effect on rate of influenza replication. However, FKBP5 up-regulation mediated the suppressive effect of glucocorticoid on pro-inflammatory cytokine production, since FKBP5 knock-down by siRNA increased cytokine production in the presence of glucocorticoid. Overall, the results suggested that the up-regulation of FKBP5 is a physiological response of lung cells to the increase of glucocorticoid during influenza infections, which facilitates the suppressive effect of glucocorticoid on pro-inflammatory cytokine production.