Methylation of the mRNA 5 0 cap by cellular methyltransferases enables efficient translation and avoids recognition by innate immune factors. Coronaviruses encode viral 2 0 -O-methyltransferases to shield their RNA from host factors. Here, we generate recombinant SARS-CoV-2 harboring a catalytically inactive 2 0 -O-methyltransferase Nsp16, Nsp16mut, and analyze viral replication in human lung epithelial cells. Although replication is only slightly attenuated, we find SARS-CoV-2 Nsp16mut to be highly immunogenic, resulting in a strongly enhanced release of type I interferon upon infection. The elevated immunogenicity of Nsp16mut is absent in cells lacking the RNA sensor MDA5. In addition, we report that Nsp16mut is highly sensitive to type I IFN treatment and demonstrate that this strong antiviral effect of type I IFN is mediated by the restriction factor IFIT1. Together, we describe a dual role for the 2 0 -O-methyltransferase Nsp16 during SARS-CoV-2 replication in avoiding efficient recognition by MDA5 and in shielding its RNA from interferon-induced antiviral responses, thereby identifying Nsp16 as a promising target for generating attenuated and highly immunogenic SARS-CoV-2 strains and as a potential candidate for therapeutic intervention.