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Interferon therapy for the treatment of hepatitis C virus infection has very limited clinical application due to short serum half-life and side effects of therapy in systemic route of administration. In the present study, we have focused to improve the interferon therapy by overcoming the limitation of side effects. We hypothesized that latent interferon alpha 2b (IFNα2b) produced by fusion of Latency associated protein (LAP) domain of TGFβ and IFNα2b having HCV NS3 protease cleavage site as linker that will be activated only at target site (liver) by viral protease (HCV NS3 protease) present on the surface of infected cells. The fusion proteins were expressed in pichia pastoris as homodimer and cleaved by recombinant HCV NS3 protease in vitro into two fragments corresponding to the IFNα-2b and LAP respectively. The latency of chimeric proteins and biological activity after treatment with HCV NS3 protease was assessed by cytopathic effect inhibition assay in A594 cells infected with encephalomyocarditis virus (EMCV) and reduction in HCV viral load in Huh7 cells. The HCV NS3 protease was present on the surface of HCV replicating Huh7 cells in amount that activated half of the effective concentration (EC50) of latent IFNα2b fusion protein. As free circulating HCV NS3 protease was not detected in sera from chronic HCV patients and in vitro cleavage of intact latent IFNα2b fusion protein was not observed with peripheral blood mononuclear cells (PBMCs) isolated from chronic HCV patients, thus there are less likely chances of activation and off target binding of latent IFNα2b to show side effects during systemic route of administration. Therefore, most of the side effects of interferon can be overwhelmed at the cost of 50% reduced biological activity. Thus, the use of latent IFNα2b can be considered again as an option for treatment of HCV infection in combination with direct acting antivirals rather than alone with improved safety profile. [ABSTRACT FROM AUTHOR]