The human interferon-induced protein kinase PKR is a key component of innate immunity, a process in which it senses pathogenic RNA. PKR consists of an N-terminal dsRNA-binding domain (dsRBD) and a C-terminal kinase domain. Upon binding long (>33 base pairs) stretches of pathogenic dsRNA, PKR undergoes autophosphorylation, which activates it to phosphorylate eIF2a, leading to inhibition of translation initiation. Many cellular and viral transcripts contain nucleoside modifications, and these could affect PKR activation. For example, a 59-triphosphate confers the ability of relatively unstructured transcripts to activate PKR. Effects of internal RNA modifications on PKR activation have not been reported. Herein, PKR activation by ssRNA and dsRNA containing internal nucleobase, sugar, and phosphodiester modifications is analyzed. We find that for 59-triphosphate-containing ssRNA, most base and sugar modifications abrogate activation, although 29-fluoro-modified ssRNA does not, indicative of a critical role for hydrogen bonding at the ribose sugar. In the case of dsRNA, a more limited set of nucleoside modifications affect PKR activation. Watson-Crick base-pairing is required for activation, and some minor groove modifications abrogate activation while major groove modifications have little effect. Surprisingly, GU wobble pairs also largely abrogate dsRNA-mediated activation when present at modest levels. Modifications to dsRNA that abrogate activation have no significant effect on dsRBD binding, allowing such RNAs to act as inhibitors and suggesting a nonequivalence of binding ability and activation. Overall, the findings indicate that nucleoside modifications and wobble pairing may serve to discriminate self-RNA and pathogenic RNA in innate immunity.