Many genes induced by type I interferons (IFNs) are also induced by double-stranded (ds)RAN. In this study, we investigated the mechanism of this induction process. Using cell lines from which the type I IFN genes have been deleted, we established that induction by dsRNA of the IFN-inducible 561 gene is direct and not mediated by the intermediate synthesis of IFN. Unlike 561 mRNA, the IFN-inducible 6-16 mRNA was induced poorly by dsRNA. Transfection studies demonstrated that the sequence difference between the core IFN-stimulated response elements (ISREs) of these two genes is not responsible for their differential inducibility by dsRNA. A point mutation in the 561 ISRE that abolished its response to IFN-alpha also made it unresponsive to dsRNA, thus demonstrating that the ISRE is the relevant cis-acting element for dsRNA signaling. The roles of different known ISRE-binding protein and tyrosine kinases in transducing the signal elicited by dsRNA were evaluated in genetically altered cell lines. dsRNA failed to induce 561 mRNA in cells expressing an anti-sense RNA for interferon regulatory factor 1, whereas it was induced strongly in cells expressing the corresponding sense mRNA. 561 mRNA was also induced strongly by dsRNA, but not by IFN-alpha, in mutant cell lines that do not express functional tyrosine kinases Tyk2 or JAK1 or ISRE binding protein, p48, or STAT2, all of which are required for IFN-alpha signaling. However, in cells devoid of functional STAT1, which is also required for IFN-alpha signaling, the induction of 561 mRNA by dsRNA was very low. Expression of transfected STAT1 alpha protein, but not of STAT 1beta protein, in these cells greatly enhanced the dsRNA inducibility of the 561 gene. These studies indicated that the major ISRE-mediated signaling pathway used by dsRNA requires interferon regulatory factor 1 and STAT alpha. This pathway, however, does not require the other known cytoplasmic components used for IFN-alpha signaling.