Tick-borne encephalitis virus (TBEV) (family Flaviviridae, genus Flavivirus) accounts for approximately 10,000 annual cases of severe encephalitis in Europe and Asia. Here, we investigated the induction of the antiviral type I interferons (IFNs) (alpha/beta IFN [IFN-alpha/beta]) by TBEV. Using strains Neudörfl, Hypr, and Absettarov, we demonstrate that levels of IFN-beta transcripts and viral RNA are strictly correlated. Moreover, IFN induction by TBEV was dependent on the transcription factor IFN regulatory factor 3 (IRF-3). However, even strain Hypr, which displayed the strongest IFN-inducing activity and the highest RNA levels, substantially delayed the activation of IRF-3. As a consequence, TBEV can keep the level of IFN transcripts below the threshold value that would permit the release of IFN by the cell. Only after 24 h of infection have cells accumulated sufficient IFN transcripts to produce detectable amounts of secreted IFNs. The delay in IFN induction appears not to be caused by a specific viral protein, since the individual expressions of TBEV C, E, NS2A, NS2B, NS3, NS4A, NS4B, NS5, and NS2B-NS3, as well as TBEV infection itself, had no apparent influence on specific IFN-beta induction. We noted, however, that viral double-stranded RNA (dsRNA), an important trigger of the IFN response, is immunodetectable only inside intracellular membrane compartments. Nonetheless, the dependency of IFN induction on IFN promoter stimulator 1 (IPS-1) as well as the phosphorylation of the alpha subunit of eukaryotic initiation factor 2 (eIF2alpha) suggest the cytoplasmic exposure of some viral dsRNA late in infection. Using ultrathin-section electron microscopy, we demonstrate that, similar to other flaviviruses, TBEV rearranges intracellular membranes. Virus particles and membrane-connected vesicles (which most likely represent sites of virus RNA synthesis) were observed inside the endoplasmic reticulum. Thus, apparently, TBEV rearranges internal cell membranes to provide a compartment for its dsRNA, which is largely inaccessible for detection by cytoplasmic pathogen receptors. This delays the onset of IFN induction sufficiently to give progeny particle production a head start of approximately 24 h.