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 (WOMAC®) 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.