Hepatitis C virus (HCV) is the major cause of non-A non-B hepatitis and a leading cause of liver dysfunction worldwide. While the current therapy for chronic HCV infection is parenteral administration of type 1 interferon (IFN), only a fraction of HCV-infected individuals completely respond to treatment. Previous studies have correlated the IFN sensitivity of strain HCV-1b with mutations within a discrete region of the viral nonstructural 5A protein (NS5A), termed the interferon sensitivity determining region (ISDR), suggesting that NS5A may contribute to the IFN-resistant phenotype of HCV. To determine the importance of HCV NS5A and the NS5A ISDR in mediating HCV IFN resistance, we tested whether the NS5A protein could regulate the IFN-induced protein kinase, PKR, a mediator of IFN-induced antiviral resistance and a target of viral and cellular inhibitors. Using multiple approaches, including biochemical, transfection, and yeast genetics analyses, we can now report that NS5A represses PKR through a direct interaction with the protein kinase catalytic domain and that both PKR repression and interaction requires the ISDR. Thus, inactivation of PKR may be one mechanism by which HCV avoids the antiviral effects of IFN. Finally the inhibition of the PKR protein kinase, by NS5A is the first described function for this HCV protein.