In addition to the phosphoprotein, the P gene of measles virus (MV) also encodes the V and C proteins by an RNA editing process and by alternative initiation of translation in a different reading frame, respectively. Although the MV C protein is required for efficient MV replication in vivo and in some cultured cells, its exact functions in virus infection are currently unclear. Here, we report that a recombinant MV lacking the C protein (MVDeltaC) grew poorly in a human cell line possessing the intact interferon (IFN) pathway and that this growth defect was associated with reduced viral translation and genome replication. The translational inhibition was correlated with phosphorylation of the alpha subunit of eukaryotic translation initiation factor 2. Moreover, increased IFN induction was observed in MVDeltaC-infected cells. The NS1 protein of influenza virus, which binds to double-stranded RNA (dsRNA) and consequently inhibits IFN induction and dsRNA-dependent protein kinase activation, complemented the growth defect of MVDeltaC. These results indicate that the MV C protein inhibits IFN induction and modulates host antiviral responses, thereby ensuring MV growth in host cells.