Endothelial cells (EC) can present antigen to either CD8(+) T lymphocytes through constitutively expressed major histocompatibility complex class I (MHC-I) or CD4(+) T lymphocytes through gamma interferon (IFN-γ)-induced MHC-II. Kaposi's sarcoma-associated herpesvirus (KSHV) is the etiological agent of Kaposi's sarcoma (KS), an EC neoplasm characterized by dysregulated angiogenesis and a substantial inflammatory infiltrate. KSHV is understood to have evolved strategies to inhibit MHC-I expression on EC and MHC-II expression on primary effusion lymphoma cells, but its effects on EC MHC-II expression are unknown. Here, we report that the KSHV infection of human primary EC inhibits IFN-γ-induced expression of the MHC-II molecule HLA-DR at the transcriptional level. The effect is functionally significant, since recognition by an HLA-DR-restricted CD4(+) T-cell clone in response to cognate antigen presented by KSHV-infected EC was attenuated. Inhibition of HLA-DR expression was also achieved by exposing EC to supernatant from KSHV-inoculated EC before IFN-γ treatment, revealing a role for soluble mediators. IFN-γ-induced phosphorylation of STAT-1 and transcription of CIITA were suppressed in KSHV-inoculated EC via a mechanism involving SOCS3 (suppressor of cytokine signaling 3). Thus, KSHV infection resulted in transcriptional upregulation of SOCS3, and treatment with RNA interference against SOCS3 relieved virus-induced inhibition of IFN-γ-induced STAT-1 phosphorylation. Since cell surface MHC-II molecules present peptide antigens to CD4(+) T lymphocytes that can function either as direct cytolytic effectors or to initiate and regulate adaptive immune responses, inhibition of this antigen-presenting pathway would provide a survival advantage to the virus.