Interleukin-10 is a predominantly anti-inflammatory cytokine that inhibits macrophage and dendritic cell function, but can acquire proinflammatory activity during immune responses. We investigated whether type I IFNs, which are elevated during infections and in autoimmune diseases, modulate the activity of IL-10. Priming of primary human macrophages with low concentrations of IFN-alpha diminished the ability of IL-10 to suppress TNF-alpha production. IFN-alpha conferred a proinflammatory gain of function on IL-10, leading to IL-10 activation of expression of IFN-gamma-inducible, STAT1-dependent genes such as IFN regulatory factor 1, IFN-gamma-inducible protein-10 (CXCL10), and monokine induced by IFN-gamma (CXCL9). IFN-alpha priming resulted in greatly enhanced STAT1 activation in response to IL-10, and STAT1 was required for IL-10 activation of IFN-gamma-inducible protein-10 and monokine induced by IFN-gamma expression in IFN-alpha-primed cells. In control, unprimed cells, IL-10 activation of STAT1 was suppressed by constitutive activity of protein kinase C and Src homology 2 domain-containing phosphatase 1. These results demonstrate that type I IFNs regulate the balance between IL-10 anti- and proinflammatory activity, and provide insight into molecular mechanisms that regulate IL-10 function. Gain of IL-10 proinflammatory functions may contribute to its pathogenic role in autoimmune diseases characterized by elevated type I IFN levels, such as systemic lupus erythematosus.