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During muscle regeneration, interferon-gamma (IFN- γ ) coordinates inflammatory responses critical for activation of quiescent muscle stem cells upon injury via the Janus kinase (JAK) - signal transducer and activator of transcription 1 (STAT1) pathway. Dysregulation of JAK-STAT1 signaling results in impaired muscle regeneration, leading to muscle dysfunction or muscle atrophy. Until now, the underlying molecular mechanism of how JAK-STAT1 signaling resolves during muscle regeneration remains largely elusive. Here, we demonstrate that epithelial-stromal interaction 1 (Epsti1), an interferon response gene, has a crucial role in regulating the IFN- γ -JAK-STAT1 signaling at early stage of muscle regeneration. Epsti1-deficient mice exhibit impaired muscle regeneration with elevated inflammation response. In addition, Epsti1-deficient myoblasts display aberrant interferon responses. Epsti1 interacts with valosin-containing protein (VCP) and mediates the proteasomal degradation of IFN- γ -activated STAT1, likely contributing to dampening STAT1-mediated inflammation. In line with the notion, mice lacking Epsti1 exhibit exacerbated muscle atrophy accompanied by increased inflammatory response in cancer cachexia model. Our study suggests a crucial function of Epsti1 in the resolution of IFN- γ -JAK-STAT1 signaling through interaction with VCP which provides insights into the unexplored mechanism of crosstalk between inflammatory response and muscle regeneration., Competing Interests: Competing Interests: The authors have declared that no competing interest exists., (© The author(s).)