Poxviruses encode a large number of proteins that attenuate the inflammatory and immune responses to infection. In this report we demonstrate that a number of orthopoxviruses express a type I interferon (IFN)-binding protein, which is encoded by the B18R open reading frame in the WR strain of vaccinia virus. The B18R protein has significant regions of homology with the alpha subunits of the mouse, human, and bovine type I IFN receptors, bound human IFN alpha 2 with high affinity, and inhibited transmembrane signaling as demonstrated by inhibition of Fc receptor factor gamma 1/gamma 2 and interferon-stimulated gene factor-3 formation as well as inhibition of the IFN alpha antiviral response. Among viral host response modifiers, the B18R protein is unique inasmuch as it exists as a soluble extracellular as well as a cell surface protein and thus should effectively block both autocrine and paracrine functions of IFN.