Gamma-herpesvirus infections are regulated by both CD4+ and CD8+ T cells. However clinical disease occurs mainly in CD4+ T cell-deficient hosts. In CD4+ T cell-deficient mice, CD8+ T cells control acute but not chronic lung infection by Murid Herpesvirus-4 (MuHV-4). We show that acute and chronic lung infections differ in distribution: most acute infection was epithelial, whereas most chronic infection was in myeloid cells. CD8+ T cells controlled epithelial infection, but CD4+ T cells and IFNγ were required to control myeloid cell infection. Disrupting the MuHV-4 K3, which degrades MHC class I heavy chains, increased viral epitope presentation by infected lung alveolar macrophages and allowed CD8+ T cells to prevent disease. Thus, viral CD8+ T cell evasion led to niche-specific immune control, and an essential role for CD4+ T cells in limiting chronic infection.