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The avian pathogen fowlpox virus (FWPV) has been successfully used as a vaccine vector in poultry and humans, but relatively little is known about its ability to modulate host antiviral immune responses in these hosts, which are replication-permissive and nonpermissive, respectively. FWPV is highly resistant to avian type I interferon (IFN) and able to completely block the host IFN-response. Microarray screening of host IFN-regulated gene expression in cells infected with 59 different, nonessential FWPV gene knockout mutants revealed that FPV184 confers immunomodulatory capacity. We report that the FPV184-knockout virus (FWPV&Delta, 184) induces the cellular IFN response as early as 2 h postinfection. The wild-type, uninduced phenotype can be rescued by transient expression of FPV184 in FWPV&Delta, 184-infected cells. Ectopic expression of FPV184 inhibited polyI:C activation of the chicken IFN-&beta, promoter and IFN-&alpha, activation of the chicken Mx1 promoter. Confocal and correlative super-resolution light and electron microscopy demonstrated that FPV184 has a functional nuclear localisation signal domain and is packaged in the lateral bodies of the virions. Taken together, these results provide a paradigm for a late poxvirus structural protein packaged in the lateral bodies, capable of suppressing IFN induction early during the next round of infection.