Severe acute respiratory syndrome (SARS) coronavirus is highly pathogenic in humans and evades innate immunity at multiple levels. It has evolved various strategies to counteract the production and action of type I interferons, which mobilize the front-line defense against viral infection. In this study we demonstrate that SARS coronavirus M protein inhibits gene transcription of type I interferons. M protein potently antagonizes the activation of interferon-stimulated response element-dependent transcription by double-stranded RNA, RIG-I, MDA5, TBK1, IKKepsilon, and virus-induced signaling adaptor (VISA) but has no influence on the transcriptional activity of this element when IRF3 or IRF7 is overexpressed. M protein physically associates with RIG-I, TBK1, IKKepsilon, and TRAF3 and likely sequesters some of them in membrane-associated cytoplasmic compartments. Consequently, the expression of M protein prevents the formation of TRAF3.TANK.TBK1/IKKepsilon complex and thereby inhibits TBK1/IKKepsilon-dependent activation of IRF3/IRF7 transcription factors. Taken together, our findings reveal a new mechanism by which SARS coronavirus circumvents the production of type I interferons.