Persistent infection with bovine viral diarrhea virus (BVDV) serves as a reservoir for the perpetuation of infection in cattle populations and causes a range of adverse effects on the health of the host. To study the interactions of the virus with the host, gene expression was compared in the blood of persistently infected (PI) and uninfected steer, and in the blood and tissues of PI fetuses, transiently infected (TI), and uninfected bovine fetuses. Microarray analysis of PI steer blood revealed differential gene expression indicative of an interferon (IFN) response including genes involved in cell cycle regulation, which may contribute to long-term adverse effects. Upregulation of IFN-stimulated genes (e.g., ISG15, PKR) and RNA helicases (RIG-I, LGP2, MDA-5) was identified in both PI fetal and steer blood in comparison to controls, indicating a continued stimulation of the innate antiviral response as a result of the persistent viremia. ISG15 was studied in further detail, implicating reticular cells as basal producers of ISG15 in the spleen, in addition to endothelial and macrophage-like cells in infected spleen. Consequences of chronic IFN pathway activation in PI cattle may include growth- and immunosuppression, the pathogenesis of which is still poorly understood. This study lends new insights into the interactions between BVDV and its host, and can serve as a model for studies of the role of the IFN system in persistent infections.