Peptides derived from retroviral envelope proteins have been shown to possess a wide range of immunosuppressive and anti-inflammatory activities. We have previously reported identification of such a peptide derived from the envelope protein coded by a human endogenous retrovirus (HERV). In this study, we identify that in vitro the peptide inhibits the KCa3.1 potassium channel, a potential target for therapy of immune diseases. We describe in vitro ENV59-GP3 effects with respect to potency of inhibition on KCa3.1 channels and calcium influx. Furthermore, we asses in vivo the effect of blocking KCa3.1 with ENV59-GP3 peptide or KCa3.1-blocker NS6180 on protection against DSS-induced acute colitis. ENV59-GP3 peptide treatment showed reduction of the disease score in the DSS-induced acute colitis mice model, which was comparable to effects of the KCa3.1 channel blocker NS6180. Analysis of cytokine production from DSS-mice model treated animals revealed equipotent inhibitory effects of the ENV59-GP3 and NS6180 compounds on the production of IL-6, TNF-α, IL-1β. These findings altogether suggest that ENV59-GP3 functions as a KCa3.1 channel inhibitor and underline the implications of using virus derived channel blockers for treatment of autoimmune diseases. Additionally, they open the possibilities whether KCa3.1 inhibition is efficacious in patients with inflammatory bowel diseases.