•Insomnia is prevalent in breast cancer survivors and contributes to inflammation.•Inflammation in breast cancer survivors predicts disease recurrence and mortality.•Insomnia treatment reverses inflammation over one year in breast cancer survivos.•Tai Chi, as compared to cognitive behavioral therapy for insomnia, preferentially reduces inflammation in breast cancer survivors. Insomnia contributes to inflammation in breast cancer survivors. This study evaluates whether insomnia treatment reverses inflammation in breast cancer survivors with insomnia. Participants (n = 90) were randomized to 3 months of Tai Chi (n = 45) or cognitive behavioral therapy for insomnia (CBT-I)(n = 45), and followed for one year post-intervention to 15 month endpoint. Our previous report found that Tai Chi as compared to CBT-I resulted in similar rates of insomnia response and remission over 15 months. Here, we analyze changes in plasma C-reactive protein and pro- and anti-inflammatory cytokines, Toll-like receptor (TLR)-4 stimulated monocyte production of interleukin (IL)-6 and tumor necrosis factor-α (TNF), and cellular pro-inflammatory and anti-viral gene expression (Conserved Transcriptional Response to Adversity RNA profile; CTRA) over 15 months. Insomnia treatment resulted in decreases in the TLR-4 stimulated monocyte production of IL-6, TNF, and their co-expression, as well as decreases in the CTRA profile, decreases inflammatory gene transcripts, and increases in anti-viral gene transcripts over 15 months (all P’s < 0.01). In addition, as compared to CBT-I, Tai Chi resulted in greater decreases in plasma IL-6 (P < 0.05), and greater decreases in TLR-4 activated monocyte production of IL-6 and co-expression of IL-6 and TNF at 15 month endpoint. CBT-I resulted in greater increases in anti-viral gene transcripts. Administration of either CBT-I or Tai Chi effectively treats insomnia, and shows additional benefits of reducing cellular and genomic markers of inflammation, and increasing anti-viral genomic markers in breast cancer survivors with insomnia. Tai Chi, as compared to CBT-I, yields greater and more durable decreases in systemic- and cellular inflammation. Targeting insomnia might mitigate the risk of inflammation-related co-morbidities in breast cancer survivors.