Failure of the immune system to eradicate viruses results in chronic viral infections, which are associated with increased susceptibility to secondary infections. Pathogenic HIV or lymphocytic choriomeningitis virus chronic infections display a persistent type I IFN signature. In chronic lymphocytic choriomeningitis virus infection, blockade of type I IFN signaling partially restores antiviral responses. In a mouse model, we tested whether chronic administration of type I IFN, at doses mimicking chronic viral infection, induced immunosuppression. Chronic exposure of mice to IFN-α alone was sufficient to strongly suppress specific CD8 T cells responses to subsequent vaccinia virus infection. It resulted in the accumulation of Ly6C monocytes. These monocytes were similar, phenotypically and functionally, to the myeloid-derived suppressor cells found in cancer because they exerted a potent suppression on CD8 T cell responses in vitro. They acted at least partly through the l-arginine pathway. In vivo, their elimination restored antiviral CD8 T cell responses. Our work provides a specific mechanism accounting for the role of IFN-α in immunosuppression and predicts that type I IFN modulation will be pivotal to cure human chronic infections, cancer, or autoimmune diseases.