Most people know that bees, wasps, hornets and some ants can sting to defend themselves or their nests. Only a few people realize, usually from first hand experience, that handling some caterpillars can produce some painful results.
Stinging caterpillars possess hollow quill-like hairs, connected to poison sacs, that are used as defensive weapons. When these hairs are touched they break through the skin releasing the poison. Reactions can range from a mild itching to the more severe pain, dermatitis, and even intestinal disturbances.
Most encounters with stinging caterpillars result from accidentally brushing against leaves on which they are feeding. Don't brush it off or slap it with a bare hand. Use a stick or other object to remove it carefully. Hollow spines may break off in clothing or gloves.
No really effective home first aid treatments for caterpillar stings are available. Adhesive tape or transparent tape may be used to pull out some of the broken spines in the sting area. Washing the area thoroughly with soap and water may help remove some of the irritating venom. Prompt application of an ice pack or baking soda may help to reduce pain and prevent swelling. Antihistaminic drugs, often administered for bee and wasp stings, are reportedly ineffective. See a physician if severe reactions occur. Very young, aged or persons in poor health are more likely to suffer severe reaction symptoms.
Source: University of Kentucky