The discovery and initial description of the interferon-lambda (IFN-lambda) family in early 2003 opened an exciting new chapter in the field of IFN research. There are 3 IFN-lambda genes that encode 3 distinct but highly related proteins denoted IFN-lambda1, -lambda2, and -lambda3. These proteins are also known as interleukin-29 (IL-29), IL-28A, and IL-28B, respectively. Collectively, these 3 cytokines comprise the type III subset of IFNs. They are distinct from both type I and type II IFNs for a number of reasons, including the fact that they signal through a heterodimeric receptor complex that is different from the receptors used by type I or type II IFNs. Although type I IFNs (IFN-alpha/beta) and type III IFNs (IFN-lambda) signal via distinct receptor complexes, they activate the same intracellular signaling pathway and many of the same biological activities, including antiviral activity, in a wide variety of target cells. Consistent with their antiviral activity, expression of the IFN-lambda genes and their corresponding proteins is inducible by infection with many types of viruses. Therefore, expression of the type III IFNs (IFN-lambdas) and their primary biological activity are very similar to the type I IFNs. However, unlike IFN-alpha receptors which are broadly expressed on most cell types, including leukocytes, IFN-lambda receptors are largely restricted to cells of epithelial origin. The potential clinical importance of IFN-lambda as a novel antiviral therapeutic agent is already apparent. In addition, preclinical studies by several groups indicate that IFN-lambda may also be useful as a potential therapeutic agent for other clinical indications, including certain types of cancer.