In recent years, gut–brain axis signaling has been recognized as an essential factor modifying behavior, mood, cognition, and cellular viability under physiological and pathological conditions. Consequently, the intestinal microbiome has become a potential therapeutic target in neurological and psychiatric disorders. The microbiota-derived metabolite of tryptophan (Trp), indole-3-propionic acid (IPA), was discovered to target a number of molecular processes and to impact brain function. In this review, we outline the key mechanisms by which IPA may affect neuronal activity and survival and provide an update on the evidence supporting the neuroprotective action of the compound in various experimental paradigms. Accumulating data indicates that IPA is a free radical scavenger, a ligand of aryl hydrocarbon receptors (AhR) and pregnane X receptors (PXR), and an anti-inflammatory molecule. IPA decreases the synthesis of the proinflammatory nuclear factor kappa-light-chain-enhancer of activated B cells (NF-κB), tumor necrosis factor-α (TNF-α), and other cytokines, reduces the generation of the NLR family pyrin domain containing 3 (NLRP3) inflammasome, and enhances the synthesis of neurotrophic factors. Furthermore, produced in the gut, or administered orally, IPA boosts the central levels of kynurenic acid (KYNA), a neuroprotective metabolite of Trp. IPA reduces the release of proinflammatory molecules in the gut, breaking the gut–inflammation–brain vicious cycle, which otherwise leads to neuronal loss. Moreover, as a molecule that easily enters central compartment, IPA may directly impact brain function and cellular survival. Overall, the gathered data confirms neuroprotective features of IPA, and supports its potential use in high-risk populations, in order to delay the onset and ameliorate the course of neurodegenerative disorders and cognitive impairment. Clinical trials evaluating IPA as a promising therapeutic add-on, able to slow down the progress of neurodegenerative disorders such as Alzheimer’s or Parkinson’s disease and to limit the morphological and behavioral consequences of ischemic stroke, are urgently needed.