The objective of this study was to investigate the safety and efficacy of a dietary supplement, Arthrem, containing an extract from the medicinal plant Artemisia annua, on pain, stiffness, and functional limitation in osteoarthritis (OA) of the hip or knee. Forty-two patients were randomized to one of three groups (n = 14 in each group): 150-mg Artemisia annua extract (ART) twice daily (BD) (ART low dose), 300-mg ART BD (ART high dose), or placebo BD administered over 12 weeks. Efficacy was assessed using the Western Ontario and McMaster Universities Osteoarthritis Index (WOMACA (R)) and visual analog scale (VAS) for pain. Participants treated with ART low dose demonstrated significant improvement in WOMAC total scores from baseline to 12 weeks (mean change, -12.2; standard deviation, [SD] 13.84; p = 0.0159); improvement was not shown in the placebo group (mean change, -7.8; SD, 19.80; p = 0.1029). Statistically significant reductions were seen from baseline in the ART low-dose group for individual WOMAC components stiffness and physical function. VAS pain scores were statistically significantly reduced from baseline to 12 weeks in the ART low-dose group (mean change, -21.4 mm; SD, 23.48 mm; p = 0.0082) but not the placebo group (mean change, -11.5 mm; SD, 28.97 mm, p = 0.1757). No statistically significant changes occurred from baseline in the placebo or ART high-dose groups for any parameter. ART low dose was well tolerated. ART has potential as an anti-inflammatory/analgesic in OA. Treatment with ART 150 mg BD is associated with clinically relevant reductions in pain over 12 weeks. Further studies are warranted.