Chronic ocular inflammation is associated with many retinal degenerative diseases that result in vision loss. The immune-privileged environment and complex organization of retinal tissue allow for the retina’s essential role in visual function processes, yet confound inquiries into cell-specific inflammatory effects that lead to retinal dysfunction and degeneration. Caveolin-1 (Cav1) is an integral membrane protein expressed in many retinal cell populations and has been implicated in retinal immune regulation. However, the direction (i.e., promotion or inhibition) in which Cav1 regulates inflammatory processes in the retina (as well as in other tissues) remains unclear. Previously, we showed that global-Cav1 depletion in the retina paradoxically resulted in reduced retinal inflammatory cytokine production with concurrent elevated retinal immune cell infiltration. We hypothesized that our previous results could be explained by cell-specific Cav1 functions in the retina. Here, we utilized our Chx10 (visual system homeobox 2)-Cre knockout model to deplete Cav1 specifically in the neural retinal (NR) compartment in order to clarify the role of neural retinal-specific Cav1 (NR-Cav1) in the retinal immune response to intravitreal LPS (lipopolysaccharide) challenge. Our data support that neural retinal-derived Cav1 promotes retinal tissue inflammation as Chx10-mediated Cav1 depletion was sufficient to suppress both retinal cytokine production and immune cell infiltration following inflammatory stimulation. Additionally, we identify Traf3 (tumor necrosis factor (TNF) receptor-associated factor 3) as a highly expressed potential immune modulator in retinal tissue that is upregulated with NR-Cav1 depletion. Furthermore, this study highlights the importance for understanding the role of Cav1 (and other proteins) in cell-specific contexts.