Kaposi's sarcoma-associated herpesvirus (KSHV) is linked with Kaposi's sarcoma and lymphomas. The pathogenesis of KSHV depends on the balance between two phases of the viral cycle: latency and lytic replication. In this study, we report that KSHV-encoded microRNAs (miRNAs) function as regulators by maintaining viral latency and inhibiting viral lytic replication. MiRNAs are short, noncoding, small RNAs that post-transcriptionally regulate the expression of messenger RNAs. Of the 12 viral miRNAs expressed in latent KSHV-infected cells, we observed that expression of miR-K3 can suppress both viral lytic replication and gene expression. Further experiments indicate that miR-K3 can regulate viral latency by targeting nuclear factor I/B. Nuclear factor I/B can activate the promoter of the viral immediate-early transactivator replication and transcription activator (RTA), and depletion of nuclear factor I/B by short hairpin RNAs had similar effects on the viral life cycle to those of miR-K3. Our results suggest a role for KSHV miRNAs in regulating the viral life cycle.