Type I interferons (IFNs), including IFN-α, -β, and -ω, play a critical role in innate immune responses against viral infection. IFN-λ, including IL-29, IL-28A, and IL-28B, recently identified as a new subfamily of IFN named type III IFN, has also been demonstrated to suppress virus replication in vitro and in vivo. However, the molecular mechanisms that regulate the induction of type III IFNs during viral infection remain elusive. Here, we demonstrate that IL-28 (IFN-λ 2/3) IFN production, similar to type I IFN, represents a primary and direct host response to HCV genomic RNA transfection. IL-28 (IFN-λ2/3) induction by HCV genomic RNA was dependent upon the activation of NF-κB and IRF3. We identified a minimal IL-28 promoter region consisting of putative NF-κB and IRF3-binding sites. Furthermore, we showed that HCV infection can inhibit HCV genomic RNA-induced IL-28 expression, and that the viral NS3/4A protease activity was responsible for this inhibitory effect. Our results present important evidence for the control of type III IFN response by HCV, and shed more light on the molecular mechanisms underlying the persistence of HCV infection.