Type III interferons (IFNs) play a vital role in maintaining the antiviral state of the mucosal epithelial surface in the gut, and in turn, enteric viruses may have evolved to evade the type III IFN responses during infection. To study the possible immune evasion of the type III IFN response by porcine epidemic diarrhea virus (PEDV), a line of porcine intestinal epithelial cells was developed as a cell model for PEDV replication. IFN-λ1 and IFN-λ3 inhibited PEDV replication, indicating the anti-PEDV activity of type III IFNs. Of the 21 PEDV proteins, nsp1, nsp3, nsp5, nsp8, nsp14, nsp15, nsp16, open reading frame 3 (ORF3), E, M, and N were found to suppress type III IFN activities, and IRF1 (interferon regulatory factor 1) signaling mediated the suppression. PEDV specifically inhibited IRF1 nuclear translocation. The peroxisome is the innate antiviral signaling platform for the activation of IRF1-mediated IFN-λ production, and the numbers of peroxisomes were found to be decreased in PEDV-infected cells. PEDV nsp1 blocked the nuclear translocation of IRF1 and reduced the number of peroxisomes to suppress IRF1-mediated type III IFNs. Mutational studies showed that the conserved residues of nsp1 were crucial for IRF1-mediated IFN-λ suppression. Our study for the first time provides evidence that the porcine enteric virus PEDV downregulates and evades IRF1-mediated type III IFN responses by reducing the number of peroxisomes. Porcine epidemic diarrhea virus (PEDV) is a highly contagious enteric coronavirus that emerged in swine in the United States and has caused severe economic losses. PEDV targets intestinal epithelial cells in the gut, and intestinal epithelial cells selectively induce and respond to the production of type III interferons (IFNs). However, little is known about the modulation of the type III IFN response by PEDV in intestinal epithelial cells. In this study, we established a porcine intestinal epithelial cell model for PEDV replication. We found that PEDV inhibited IRF1-mediated type III IFN production by decreasing the number of peroxisomes in porcine intestinal epithelial cells. We also demonstrated that the conserved residues in the PEDV nsp1 protein were crucial for IFN suppression. This study for the first time shows PEDV evasion of the type III IFN response in intestinal epithelial cells, and it provides valuable information on host cell-virus interactions not only for PEDV but also for other enteric viral infections in swine.