Type I interferons (IFNs) are important mediators of innate antiviral defense and function by activating a signaling pathway through their cognate type I receptor (IFNAR). Here we report that lytic replication of Kaposi's sarcoma-associated herpesvirus (KSHV) efficiently blocks type I IFN signaling and that an important effector of this blockade is the viral protein RIF, the product of open reading frame 10. RIF blocks IFN signaling by formation of inhibitory complexes that contain IFNAR subunits, the Janus kinases Jak1 and Tyk2, and the STAT2 transcription factor. Activation of both Tyk2 and Jak1 is inhibited, and abnormal recruitment of STAT2 to IFNAR1 occurs despite the decrement in Tyk2 activity. As a result of these actions, phosphorylation of both STAT2 and STAT1 is impaired, with subsequent failure of ISGF3 accumulation in the nucleus. The presence in the viral genome of potent inhibitors of type I IFN signaling, along with several viral genes that block IFN induction, highlights the importance of the IFN pathway in the control of this human tumor virus infection.The earliest host defenses mobilized against viral infection are those of the innate immune system. These include a variety of cellular elements and humoral factors; chief among the latter are the type 1 interferons (IFNs), IFN-␣ and IFN-. Expression of these cytokines is rapidly induced in infected cells, from which they are efficiently exported into the surrounding microenvironment. There, they engage a single heterodimeric receptor, IFNAR, and trigger activation of a signaling pathway that generates a plethora of proteins with broad-spectrum antiviral activities. The importance of this pathway in antiviral defense is attested to by the fact that mice bearing genetic lesions in IFNAR subunits (or one or more of their downstream effectors) are more susceptible to a variety of experimental viral infections, including picornaviruses, influenza viruses, rotaviruses, alphaviruses, bunyaviruses, herpesviruses, and retroviruses (2,3,14,18,31,39,42,43).The IFN signaling pathway is elicited by interaction of type I IFN with its receptor, a heterodimer composed of two subunits, IFNAR1 and IFNAR2. In the ground state, IFNAR1 is associated with the Janus kinase Tyk2 and IFNAR2 with the Janus kinase Jak1. IFN binding is thought to bring the IFNAR subunits together, thereby facilitating cross-tyrosine phosphorylation and activation of the two Janus kinases. Activated Tyk2 can then phosphorylate tyrosine 466 (Y466) and other sites on IFNAR1, an event that is important for subsequent signaling.The IFNAR2 cytosolic domains are preassociated with the STAT (signal transducer and activator of transcription) proteins, STAT1 and STAT2. Following receptor engagement by IFN, STAT2 is transferred to IFNAR1 by interaction of phosphorylated Y466 with the STAT2 SH2 domain. Subsequent to this, both STAT proteins are phosphorylated at specific tyrosine residues, which allows the two proteins to form a STAT1/2 heterodimer based on SH2/phosphotyrosine interactions. This hete...