Interferon gamma (IFN-gamma), which has been cloned in several mammalian species and recently in birds, plays a critical role in modulating immune system function. IFN-gamma and tumor necrosis factor alpha (TNF-alpha) have been shown to be crucial in the pathogenesis of viral hepatitis and in the transient disappearance of hepatitis B virus (HBV) from the liver after adoptive transfer of HBV-specific cytotoxic T lymphocytes into HBV-transgenic mice. Similar studies in the natural animal hosts of related hepadnaviruses have been limited because the corresponding probes and recombinant cytokines were not available. For this reason, we initiated studies to clone and characterize cytokines from the duck, the natural host of the duck hepatitis B virus (DHBV). We describe here the cDNA cloning and initial characterization of the IFN-gamma homologue of ducks (DuIFN-gamma). The DuIFN-gamma cDNA codes for a predicted mature protein of 145 amino acids with a molecular mass of 16.6 kDa. The precursor protein has 67% identity with the previously cloned chicken IFN-gamma and 21 to 34% identity with mammalian IFN-gamma. Recombinant DuIFN-gamma induces the transcription of several IFN-inducible genes including IFN regulatory factor 1 and guanylate-binding protein, and it exhibits antiviral activity that protects duck cells from vesicular stomatitis virus-mediated lysis. Importantly, treatment of primary duck hepatocytes with recombinant DuIFN-gamma inhibits DHBV replication in a dose-dependent fashion. Time course analysis revealed that IFN-gamma treatment does not affect initial covalently closed circular DNA (cccDNA) conversion but inhibits the synthesis of progeny cccDNA by amplification.