Hyperbilirubinemia is a common condition in neonatal life, where elevated levels of unconjugated bilirubin (UCB) may lead to adverse neurologic outcomes, namely in the presence of inflammatory features. In this review, we summarize recent concepts on UCB damage to brain cells and associated neuroinflammation research. Exposure of astrocytes and microglia to UCB initiates an inflammatory response with the release of proinflammatory cytokines, such as TNF-alpha, IL-1beta and IL-6, accumulation of extracellular glutamate and a time-dependent cell death. Moreover, undifferentiated cells revealed to be particularly susceptible to UCB-induced immunostimulation pointing to a mechanism that may preside to the vulnerability evidenced by premature newborns. Evaluation of intracellular mechanisms of astrocyte and microglia to UCB revealed that TNF-alpha and IL-1beta pathways as well as MAPK and NF-kappaB signaling cascades are key mediators of both cytokine production and cell toxicity observed upon UCB challenge. Understanding these mechanisms is essential for the development of new strategies targeting UCB-induced neurotoxicity. Thus, a therapeutic approach for the prevention or amelioration of neurological deficits resulting from moderate to severe hyperbilirubinemia, may consist on the use of immunomodulators, such as IL-10 that showed ability to suppress the release of cytokines from astrocytes exposed to UCB, glycoursodeoxycholic acid (GUDCA) that abrogated both UCB-stimulated cytokine secretion and UCB-induced loss of cell survival, and minocycline that evidenced a unique role in preventing neurodegeneration in in vitro and in vivo models. Novel pharmacological strategies may reduce the incidence of UCB encephalopathy and prevent minor cerebral lesions that may result in mental illness.