We have analyzed the effects of vaccinia virus (VV) on gamma interferon (IF
N-gamma) signal transduction, Infection of cells with VV 1 to 2 h prior to
treatment with IFN-gamma inhibits phosphorylation and nuclear translocation
of Stat1 and consequently blocks accumulation of mRNAs normally induced by
IFN-gamma, While phosphorylation of other proteins in the IFN-gamma pathwa
y was not affected, activation of Stat1 by other ligand-receptor systems wa
s also blocked by VV, This block of Stat1 activation was dose dependent, an
d although viral protein synthesis was not required, entry and uncoating of
viral cores appear to be needed to block the accumulation of phosphorylate
d Stat1, These results suggest that a virion component is responsible for t
he effect. VV virions contain a phosphatase (VH1) that is sensitive to the
phosphatase inhibitor Na3VO4 but not to okadaic acid. Addition of Na3VO4 bu
t not okadaic acid restored normal Stat1 phosphorylation levels in VV-infec
ted cells. Moreover, virions containing reduced levels of VH1 were unable t
o block the IFN-gamma signaling pathway. In vitro studies show that the pho
sphatase can bind and dephosphorylate Stat1, indicating that this transcrip
tion factor can be a substrate for VH1, Our results reveal a novel mechanis
m by which VV interferes with the onset of host immune responses by blockin
g the IFN-gamma signal cascade through the dephosphorylating activity of th
e viral phosphatase VH1.