Micro RNAs (miRNAs) have been implicated in the regulation of maturation, proliferation, differentiation, and activation of immune cells. In this study, we demonstrated that miR-29a antagonizes IFN-γ production at early times post-LSDV infection in cattle. miR-29a was predicted to target upstream IFN-γ regulators, and its inhibition resulted in enhanced IFN-γ production in sensitized peripheral blood mononuclear cells (PBMCs). Further, stimulation of PBMCs with LSDV antigen exhibited lower levels of miR-29a, concomitant with a potent cell-mediated immune response (CMI), characterized by an increase in LSDV-specific CD8+ T cell counts and enhanced levels of IFN-γ, which eventually facilitated virus clearance. In addition, a few immunocompromised cattle (developed secondary LSDV infection at ~ 6 months) that failed to mount a potent cell-mediated immune response, were shown to maintain higher miR-29a levels. Furthermore, as compared to the sensitized crossbred cattle, PBMCs from sensitized Rathi (a native Indian breed) animals exhibited lower levels of miR-29a along with an increase in CD8+ T cell counts and enhanced levels of IFN-γ. Finally, we analysed that a ≥ 60% decrease in miR-29a expression levels in the PBMCs of sensitized cattle correlated with a potent CMI response. In conclusion, miR-29a expression is involved in antagonizing the IFN-γ response in LSDV-infected cattle and may serve as a novel biomarker for the acute phase of LSDV infection, as well as predicting the functionality of T cells in sensitized cattle. In addition, Rathi cattle mount a more potent CMI response against LSDV than crossbred cattle.