We present a novel mechanism by which viruses may inhibit the alpha/beta interferon (IFN-alpha/beta) cascade. The double-stranded RNA (dsRNA) binding protein NS1 of influenza virus is shown to prevent the potent antiviral interferon response by inhibiting the activation of interferon regulatory factor 3 (IRF-3), a key regulator of IFN-alpha/beta gene expression. IRF-3 activation and, as a consequence, IFN-beta mRNA induction are inhibited in wild-type (PR8) influenza virus-infected cells but not in cells infected with an isogenic virus lacking the NS1 gene (delNS1 virus). Furthermore, NS1 is shown to be a general inhibitor of the interferon signaling pathway. Inhibition of IRF-3 activation can be achieved by the expression of wild-type NS1 in trans, not only in delNS1 virus-infected cells but also in cells infected with a heterologous RNA virus (Newcastle disease virus). We propose that inhibition of IRF-3 activation by a dsRNA binding protein significantly contributes to the virulence of influenza A viruses and possibly to that of other viruses.