Adenoviral evolution has generated strategies to resist host cell antiviral systems, but molecular mechanisms for evasion of interferon (IFN) effects by adenoviruses during late-phase infection are poorly defined. In this study, we examined adenovirus type 5 (AdV) effects on IFN-γ-dependent gene expression and Janus family kinase-signal transducer and activator of transcription signaling components in human tracheobronchial epithelial cells. We found that AdV infection specifically inhibited IFN-γ-dependent gene expression in airway epithelial cells without evidence of epithelial cell injury or generation of a soluble extracellular inhibitor. Furthermore, infection with AdV for 18-24 h blocked phosphorylation/activation of the Stat1 transcription factor that regulates IFN-γ-dependent genes. Although AdV also inhibited IFN-α-dependent phosphorylation of Stat1 and Stat2, interleukin-4-dependent phosphorylation of the related transcription factor Stat6 was not affected, indicating that the virus selectively affected specific signaling pathways. Our results indicate that AdV inhibition of the IFN-γ signal transduction cascade occurs through loss of ligand-induced receptor complex assembly and consequent component phosphorylation and suggest that lack of complex assembly is due to decreased expression of the IFN-γR2 chain of the IFN-γ receptor. IFN-γR2 is required at an early step in Janus family kinase-signal transducer and activator of transcription pathway activation and is expressed at low levels in airway epithelial cells, supporting the concept that adenoviral down-regulation of the level of this IFN-γ receptor component allows for persistent modulation of IFN-γ-dependent gene expression.