A topical cream formulation of the bacteriostatic antibiotic fusidic acid and the synthetic, long-acting glucocorticoid betametasone valerate with potential anti-bacterial and immunomodulating activities. Fusidic acid/betamethasone valerate topical cream inhibits Gram-positive bacterial protein synthesis and replication and inhibits the inflammatory response by preventing phospholipid release, inhibiting eosinophil activity, and decreasing pro-inflammatory cytokine production.