The cellular interferon-mediated antiviral system is initiated when double-stranded RNA (dsRNA)-activated protein kinase R (PKR) is activated by binding to either dsRNA or the cellular PKR activator, the PACT protein. Viruses try to circumvent interferon signaling by inhibiting PKR activation. Orf virus (ORFV), a parapoxvirus from the Poxviridae family, leads to contagious ecthyma in small ruminants. Previous studies have shown that various OV20.0 isoforms, encoded by the OV20.0L gene, are able to suppress PKR activation both by physically interacting with PKR and by sequestering dsRNA. We have now mapped the regions within OV20.0 that interact with dsRNA and PKR. This study also demonstrated that OV20.0 associates with the dsRNA binding domain of PACT and moreover, the presence of dsRNA strengthened the interaction of these two molecules. Finally, when PKR is stimulated by PACT, the presence of OV20.0 diminishes PKR phosphorylation. Together these observations elucidate a new strategy whereby innate immunity can be evaded by ORFV.