Iron homeostasis is maintained through meticulous regulation of circulating hepcidin levels. Hepcidin levels that are inappropriately low or high result in iron overload or iron deficiency, respectively. Although hypoxia, erythroid demand, iron, and inflammation are all known to influence hepcidin expression, the mechanisms responsible are not well defined. In this report we show that the inflammatory cytokine interleukin-6 (IL-6) directly regulates hepcidin through induction and subsequent promoter binding of signal transducer and activator of transcription 3 (STAT3). STAT3 is necessary and sufficient for the IL-6 responsiveness of the hepcidin promoter. Our findings provide a mechanism by which hepcidin can be regulated by inflammation or, in the absence of inflammatory stimuli, by alternative mechanisms leading to STAT3 activation.