The mammalian interferon (IFN) signaling pathway is a primary component of the innate antiviral response. As such, viral pathogens have devised multiple mechanisms to antagonize this pathway and thus facilitate infection. Dengue virus (DENV) encodes several proteins (NS2a, NS4a, and NS4b) that have been shown individually to inhibit the IFN response. In addition, DENV infection results in reduced levels of expression of STAT2, which is required for IFN signaling (M. Jones, A. Davidson, L. Hibbert, P. Gruenwald, J. Schlaak, S. Ball, G. R. Foster, and M. Jacobs, J. Virol. 79:5414-5420, 2005). Translation of the DENV genome results in a single polypeptide, which is processed by viral and host proteases into at least 10 separate proteins. To date, no single DENV protein has been implicated in the targeting of STAT2 for decreased levels of expression. We demonstrate here that the polymerase of the virus, NS5, binds to STAT2 and is necessary and sufficient for its reduced level of expression. The decrease in protein level observed requires ubiquitination and proteasome activity, strongly suggesting an active degradation process. Furthermore, we show that the degradation of but not binding to STAT2 is dependent on the expression of the polymerase in the context of a polyprotein that undergoes proteolytic processing for NS5 maturation. Thus, the mature form of NS5, when not expressed as a precursor, was able to bind to STAT2 but was unable to target it for degradation, establishing a unique role for viral polyprotein processing in providing an additional function to a viral polypeptide. Therefore, we have identified both a novel mechanism by which DENV evades the innate immune response and a potential target for antiviral therapeutics.