IFN-γ is an immunomodulatory cytokine and uses the STAT-1α transcription factor to mediate gene expression. The promyelocytic leukemia (PML) protein regulates transcription as an activator or repressor, depending on the gene under investigation. Herein, we examined the influence of PML on IFN-γ signaling, using PML wild-type (Pml+/+) and deficient (Pml-/-) mouse embryonic fibroblasts (MEF). Pml-/- MEF exhibit enhanced IFN-γ-induced STAT-1α transcriptional activity compared with Pml+/+ cells. Moreover, reconstitution of PML in Pml-/- MEF reduced STAT-1α transcriptional activity to levels comparable to Pml+/+ MEF. Numerous endogenous IFN-γ-regulated genes were up-regulated in Pml-/- MEF compared with Pml+/+ MEF. IFN-γ-mediated STAT-1α DNA-binding activity was enhanced in Pml-/- cells compared with Pml+/+ cells. Lastly, IFN-γ enhanced the formation of a PML-STAT-1α complex in the nucleus. These data suggest a novel function for PML in the IFN-γ signaling pathway by inhibiting STAT-1α DNA binding and transcriptional activity. © 2006 by The National Academy of Sciences of the USA.