Interferon (IFN)-l1, -2 and -3 (also designated as interleukin (IL)-29, IL-28a and IL-28b) represent a new subfamily within the class II cytokine family. They show type I IFN-like antiviral and cytostatic activities in affected cells forming the basis for IFN-l1 therapy currently under development for hepatitis C infection. However, many aspects of IFN-ls are still unknown. This study aimed at identifying the target cells of IFN-ls within the immune system and the skin. Among skin cell populations, keratinocytes and melanocytes, but not fibroblasts, endothelial cells or subcutaneous adipocytes turned out to be targets. In contrast to these target cells, blood immune cell populations did not clearly respond to even high concentrations of these cytokines, despite an IFN-l receptor expression. Interestingly, immune cells expressed high levels of a short IFN-l receptor splice variant (sIFN-lR1/sIL-28R1). Its characterization revealed a secreted, glycosylated protein that binds IFN-l1 with a moderate affinity (K D 73 nM) and was able to inhibit IFN-l1 effects. Our study suggests that IFN-l therapy should be suited for patients with verrucae, melanomas and non-melanoma skin cancers, apart from patients with viral hepatitis, and would not be accompanied by immune-mediated complications known from type I IFN application.