The genome analysis of Kaposi's sarcoma-associated herpesvirus (KSHV) has revealed the presence of an open reading frame (ORF 4) with sequence homology to complement control proteins. To assign a function to this protein, we have now expressed this ORF using the Pichia expression system and shown that the purified protein inhibited human complement-mediated lysis of erythrocytes, blocked cell surface deposition of C3b (the proteolytically activated form of C3), and served as a cofactor for factor I-mediated inactivation of complement proteins C3b and C4b (the subunits of C3 convertases). Thus, our data indicate that this KSHV inhibitor of complement activation (kaposica) provides a mechanism by which KSHV can subvert complement attack by the host.