Both acute and chronic hepatitis C virus (HCV) infections are characterized by inflammation. HCV and reduced liver blood filtration contribute to inflammation; however, the mechanisms of systemic immune activation and dysfunction as a result of HCV infection are not clear. We measured circulating inflammatory mediators (IL-6, IP10, sCD163, sCD14), indices of endotoxemia (EndoCab, LBP, FABP), and T cell markers of exhaustion and senescence (PD-1, TIGIT, CD57, KLRG-1) in HCV-infected participants, and followed a small cohort after direct-acting anti-viral therapy. IL-6, IP10, Endocab, LBP, and FABP were elevated in HCV participants, as were T cell co-expression of exhaustion and senescence markers. We found positive associations between IL-6, IP10, EndoCab, LBP, and co-expression of T cell markers of exhaustion and senescence. We also found numerous associations between reduced liver function, as measured by plasma albumin levels, and T cell exhaustion/senescence, inflammation, and endotoxemia. We found positive associations between liver stiffness (TE score) and plasma levels of IL-6, IP10, and LBP. Lastly, plasma IP10 and the proportion of CD8 T cells co-expressing PD-1 and CD57 decreased after initiation of direct-acting anti-viral therapy. Although associations do not prove causality, our results support the model that translocation of microbial products, resulting from decreased liver blood filtration, during HCV infection drives chronic inflammation that results in T cell exhaustion/senescence and contributes to systemic immune dysfunction.