Hepatitis C virus (HCV) chronic infection is characterized by low-level or undetectable cellular immune responses against HCV antigens. HCV proteins have been shown to affect various intracellular events and modulate immune responses, although the precise mechanisms used to mediate these effects are not fully understood. In this study, we have examined the effect of HCV proteins on the modulation of major histocompatibility complex (MHC) class II expression and other functions important for antigen presentation in humans. Expression of an HCV(1-2962) genomic clone (HCV-FL) in human fibrosarcoma cells (HT1080) inhibited gamma interferon (IFN-gamma)-induced upregulation of human leukocyte antigen-DR (HLA-DR) cell surface expression. Furthermore, inhibition of promoter activities of MHC class II transactivator (CIITA), IFN-gamma-activated site (GAS), and HLA-DR was observed in IFN-gamma-inducible HT1080 cells expressing HCV-FL by in vitro reporter assays. Exposure of human monocyte-derived dendritic cells (DCs) to cell culture-grown HCV (HCVcc) genotype 1a (clone H77) or 2a (clone JFH1) significantly inhibited DC maturation and was associated with the production of IL-10. Furthermore, DCs exposed to HCVcc were impaired in their functional ability to stimulate antigen-specific CD4-positive (CD4(+)) and CD8(+) T-cell responses. Taken together, our results indicated that HCV can have direct and/or indirect inhibitory effects on antigen-presenting cells, resulting in reduction of antigen-specific T-cell activation. These effects may account for or contribute to the low overall level of immunogenicity of HCV observed in chronically infected patients.