The effect of interface on the spin injection characteristics in lateral spin valves with Permalloy/ MgO/Ag junctions has been studied. The spin valve signal drastically increases after the insertion of a thin MgO layer in the local and nonlocal spin injection schemes. We analyze our results based on the spin-dependent diffusion equation. This reveals that the interface resistance of $100 fXm 2 could effectively overcome the spin resistance mismatch between ferromagnetic and nonmagnetic metals.