Vesicular stomatitis virus (VSV) replication is highly sensitive to interferon (IFN)-induced antiviral responses. VSV infection of well-known cell lines pretreated with IFN-beta results in a 10(4)-fold reduction in the release of infectious particles, with a concomitant abrogation in viral transcript and/or protein levels. However, in cell lines of neuronal lineage only a threefold reduction in viral transcript and protein levels was observed, despite the same 10(4)-fold reduction in released infectious virions, suggesting an assembly defect. Examination of VSV matrix (M) protein ubiquitination yielded no differences between mock- and IFN-beta-treated neuronal cells. Further analysis of potential post-translational modification events, by scintillation and two-dimensional electrophoretic methods, revealed IFN-beta-induced alterations in M protein and phosphoprotein (P) phosphorylation. Hypophosphorylated P protein was demonstrated by reduced (32)P counts, normalized by (35)S-cysteine/methionine incorporation, and by a shift in isoelectric focusing. Hypophosphorylation of VSV P protein was found to occur in neuronal cell lysates, but not within budded virions from the same IFN-beta-treated cells. In contrast, hyperphosphorylation of VSV M protein was observed in both cell lysates and viral particles from IFN-beta-treated neuronal cells. Hyperphosphorylated M protein was demonstrated by increased (32)P counts relative to (35)S-cysteine/methionine normalization, and by altered isoelectric focusing in protein populations from cell and viral lysates. Hyperphosphorylated VSV M protein was found to inhibit its association with VSV nucleocapsid, suggesting a possible mechanism for type I IFN-mediated misassembly through disruption of the interactions between ribonucleoprotein cores, and hyperphosphorylated M protein bound to the plasma membrane inner leaflet.