Objective: To decipher the responsible compound present in the aqueous root extract of Vetiveria zizanioides which has tremendous immunomodulatory activity. Methods: Different fractions of the water extract were collected and analyzed for immunomodulatory activity by analyzing in vitro phagocytic activity and nitric oxide production. One fraction VF3 was selected and further analyzed for possible compounds by high performance liquid chromatography and gas chromatography coupled with a mass spectrometer. The in vitro immunomodulatory parameters such as phagocytic index, nitrite content, and tumor necrosis factor-α production in murine macrophages were analyzed. In vivo studies, sheep red blood cell induced haemagglutination titer, the number of antibody-producing cells, and sheep red blood cell induced delayed-type hypersensitivity were analyzed. Cytotoxic studies in L929 normal fibroblasts were also performed. Results: One of the fractions, VF3, was selected and confirmed the presence of an active compound valencene. The in vitro immunomodulatory parameters were significantly (P<0.05) increased by valencene treatment. In vivo studies in Swiss albino mice showed that valencene could significantly (P<0.05) increase haemagglutination titer, the number of antibody-producing cells, and delayed-type hypersensitivity. Cytotoxic studies also showed that valencene did not cause any morphological changes and DNA damage in normal fibroblasts. Conclusions: Valencene possesses immunomodulatory activities and can be commercially exploited for its immunostimulatory potentials.