Kawasaki disease (KD) is an acute vasculitis of childhood that affects the medium vessels with a special predilection to the involvement of coronary arteries. The major morbidity of this disease is due to coronary artery aneurysm, which occurs in about 25–30% of untreated cases. For decades now, intravenous immunoglobulin (IVIg) has consistently been shown to reduce the risk of CAAs to less than 5%. However, the mechanism of immunomodulation remains unclear. Several studies on the role of IVIg in the modulation of toll-like receptor pathways, autophagy, and apoptosis of the mononuclear phagocytic system, neutrophil extracellular trap, and dendritic cell modulation suggest a modulatory effect on the innate immune system. Similarly, certain studies have shown its effect on T-cell differentiation, cytokine release, and regulatory T-cell function. In this review, we discuss the potential mechanisms underlying the immunomodulatory actions of IVIg in patients with Kawasaki disease. Furthermore, we provide a summary of the evidence regarding various infusion protocols and dosages utilized in the treatment of KD patients.