Direct ligand-binding studies with highly purified 125I-labeled virus-induced mouse interferon on mouse lymphoma L 1210 cells revealed a direct correlation of specific high-affinity binding with the biologic response to interferon. Neutralization of the antiviral effect by anti-interferon gamma globulin occurred at the same antibody concentration as the inhibition of specific binding. These results suggest that specific high-affinity binding of 125I-interferon occurred at a biologically functional interferon receptor. Competitive inhibition experiments using 125I- and 125I-labeled interferon provided strong evidence that the fraction of 125I-interferon inactivated upon labeling did not bind specifically. Scatchard analysis of the binding data yielded linear plots and thus suggested that interferon binds to homogeneous noncooperative receptor sites. In contrast to a characteristic property of several peptide hormone systems, binding of 125I-interferon to its specific receptor did not induce subsequent ligand degradation. At 37° bound interferon was rapidly released in a biologically active form without evidence for molecular degradation. The expression of interferon receptors was not modified by treatment with interferon. Trypsin treatment of target cells and inhibition of protein synthesis abolished the specific binding of 125I-interferon. Three major molecular weight species of Newcastle disease virus-induced mouse C 243 cell interferon were isolated separately and identified as mouse α and β interferons. These interferons were shown to inhibit competitively the specific binding of the highly purified labeled starting material which contained all three size species, thus providing evidence for a common receptor site for mouse α and β interferon.