Background: Whether type I IFN (IFN-I) is beneficial in HIV infection by inducing antiviral genes or detrimental by driving immune activation is controversial. IFN receptor antagonist (IFN-1ant) treatment during acute SIV infection accelerated progression to AIDS and death. Its mechanism and the consequences of exogenous IFN-I treatment during acute infection are unknown. Methodology: 6 rhesus macaques (RMs) received IFN-1ant and 9 RMs placebo starting at challenge through 4 weeks post-infection (wpi). 6 RMs received pegylated IFNα2a weekly from 1 week before challenge through 4 wpi and 3 RMs IFNα2a but no challenge. All challenges were done with high dose rectal SIVmac251. We evaluated SIV+ cells by in situ hybridization, APOBEC3G and TRIM5α by immunohistochemistry (IHC), lymphocyte activation and responses by flow cytometry and transcriptional profiles by mRNA deep sequencing (mRNAseq). P-values were calculated by Kaplan-Meier survival curves and differences between groups by the Mann-Whitney U test. Results: IFN-1ant RMs had delayed and reduced upregulation of IFN-stimulated genes (ISGs, see figure) and lower lymph node (LN) levels of the IFN-inducible restriction factors APOBEC3G and TRIM5α compared to placebo. They had more SIV+ cells in their LN at 12 wpi and greater LN CCR5+ CD4 T cell depletion at 4 (P=0.02) and 12 wpi (P=0.03). IFN-1ant RMs had decreased frequencies of LN HLA-DR+ CD4 (P=0.009) and CD8 (P=0.02) T cells and peripheral blood (PB) CD16+ NK cells (P=0.01) but not SIV-specific CD4 or CD8 T cells at >12 wpi. IFNα2a RMs required more challenges to be infected than placebo (P=0.0002) and had fewer transmitted/founder variants (P=0.04). After infection, IFNα2a RMs had lower peak ISG levels, more PBMC-associated SIV gag DNA at 10, 14 and 28 dpi (P=0.04, 0.04, 0.002) and greater LN CCR5+ CD4 T cell depletion at 4 (P=0.02) and 12 wpi (P=0.03). PB CD16+ NK cells (P=0.03) but not SIV-specific T cells were decreased in IFNα2a RMs at >12 wpi. SAMHD1, TRIM22 and TRIM5 expression were transiently increased in PBMCs and rectal biopsies from unchallenged RMs treated with IFNα2a. Conclusions: Delayed and decreased ISG expression during acute SIV infection in IFN-1ant RMs resulted in increased LN virus burden and CD4 T cell depletion, suggesting that IFN-Is are critical for early control of immune system damage. While increased IFN signaling can stimulate antiviral genes and protect against infection, it may result in less ISG upregulation after infection and accelerated disease progression.