Glucocorticoids remain a mainstay of modern medicine due to their ability to broadly suppress immune activation. However, they cause severe adverse effects that warrant urgent development of a safer alternative. The glucocorticoid-induced leucine zipper (GILZ) gene, TSC22D3, is one of the most highly upregulated genes in response to glucocorticoid treatment, and reduced GILZ mRNA and protein levels are associated with increased severity of inflammation in systemic lupus erythematosus (SLE), Ulcerative Colitis, Psoriasis, and other autoimmune/autoinflammatory diseases. Here, we demonstrate that low GILZ permits expression of a type I interferon (IFN) signature, which is exacerbated in response to TLR7 and TLR9 stimulation. Conversely, overexpression of GILZ prevents IFN-stimulated gene (ISG) up-regulation in response to IFNα. Moreover, GILZ directly binds STAT1 and prevents its nuclear translocation, thereby negatively regulating IFN-induced gene expression and the auto-amplification loop of the IFN response. Thus, GILZ powerfully regulates both the expression and action of type I IFN, suggesting restoration of GILZ as an attractive therapeutic strategy for reducing reliance on glucocorticoids.