Infection with bovine viral diarrhea virus (BVDV) is prevalent in the cattle population worldwide. The virus exists in two biotypes, cytopathic and non-cytopathic, depending on the effect of the viruses on cultured cells. BVDV may cause transient and persistent infections which differ fundamentally in the host's antiviral immune response. Transient infection may be due to both cytopathic and non-cytopathic biotypes of BVDV and leads to a specific immune response. In contrast, only non-cytopathic BVD viruses can establish persistent infection as a result of infection of the embryo early in its development. Persistent infection is characterized by immunotolerance specific for the infecting viral strain. In this paper we discuss the role of innate immune responses in the two types of infection. In general, both transient and persistent infections are associated with an increased frequency of secondary infections. Associated with the increased risk of such infections are, among others, impaired bacteria killing and decreased chemotaxis. Interestingly, non-cytopathic BVDV fails to induce interferon type I in cultured bovine macrophages whereas cytopathic biotypes readily trigger this response. Cells infected with non-cytopathic BVDV are also resistant to induction of interferon by double stranded RNA, a potent interferon inducer signalling the presence of viral replication in the cell. Thus, non-cytopathic BVDV may dispose of a mechanism suppressing a key element of the antiviral defence of the innate immune system. Since interferon is also important in the activation of the adaptive immune response, suppression of this signal may be essential for the establishment of persistent infection and immunotolerance.