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Antibiotic-resistant infections are predicted to kill 10 million people per year by 2050, costing the global economy $100 trillion. Therefore, there is an urgent need to develop alternative technologies. We have engineered a synthetic peptide called clavanin-MO, derived from a marine tunicate antimicrobial peptide, which exhibits potent antimicrobial and immunomodulatory properties both in vitro and in vivo. The peptide effectively killed a panel of representative bacterial strains, including multidrug-resistant hospital isolates. Antimicrobial activity of the peptide was demonstrated in animal models, reducing bacterial counts by six orders of magnitude, and contributing to infection clearance. In addition, clavanin-MO was capable of modulating innate immunity by stimulating leukocyte recruitment to the site of infection, and production of immune mediators GM-CSF, IFN-γ and MCP-1, while suppressing an excessive and potentially harmful inflammatory response by increasing synthesis of anti-inflammatory cytokines such as IL-10 and repressing the levels of pro-inflammatory cytokines IL-12 and TNF-α. Finally, treatment with the peptide protected mice against otherwise lethal infections caused by both Gram-negative and -positive drug-resistant strains. The peptide presented here directly kills bacteria and further helps resolve infections through its immune modulatory properties. Peptide anti-infective therapeutics with combined antimicrobial and immunomodulatory properties represent a new approach to treat antibiotic-resistant infections.