We have documented the key role of toll‐like receptor 4 (TLR4) activation and its signaling pathway mediated by interferon (IFN) regulatory factor 3, in the induction of inflammation leading to the hepatocellular damage during liver ischemia/reperfusion injury (IRI). Because type I IFN is the major downstream activation product of that pathway, we studied its role in comparison with IFN‐γ. Groups of type I (IFNAR), type II (IFNGR) IFN receptor–deficient mice, along with wild‐type (WT) controls were subjected to partial liver warm ischemia (90 minutes) followed by reperfusion (1‐6 hours). Interestingly, IFNAR knockout (KO) but not IFNGR KO mice were protected from IR‐induced liver damage, as evidenced by decreased serum alanine aminotransferase and preservation of tissue architecture. IR‐triggered intrahepatic pro‐inflammatory response, assessed by tumor necrosis factor (TNF‐α), interleukin 6 (IL‐6), and chemokine (C‐X‐C motif) ligand 10 (CXCL‐10) expression, was diminished selectively in IFNAR KO mice. Consistent with these findings, our in vitro cell culture studies have shown that: (1) although hepatocytes alone failed to respond to lipopolysaccharide (LPS), when co‐cultured with macrophages they did respond to LPS via macrophage‐derived IFN‐β; (2) macrophages required type I IFN to sustain CXCL10 production in response to LPS. This study documents that type I, but not type II, IFN pathway is required for IR‐triggered liver inflammation/damage. Type I IFN mediates potential synergy between nonparenchyma and parenchyma cells in response to TLR4 activation. (HEPATOLOGY 2007.)