Although interferons inhibit SARS-CoV-2 and have been evaluated for treatment of coronavirus disease 2019 (COVID-19), the most effective types and antiviral effectors remain to be defined. Here, we show that IFN-γ is particularly potent in restricting SARS-CoV-2 and in inducing expression of the antiviral factor ZAP in human lung cells. Knockdown experiments revealed that endogenous ZAP significantly restricts SARS-CoV-2. We further show that CpG dinucleotides which are specifically targeted by ZAP are strongly suppressed in the SARS-CoV-2 genome and that the two closest horseshoe bat relatives of SARS-CoV-2 show the lowest genomic CpG content of all coronavirus sequences available from this reservoir host. Nonetheless, both the short and long isoforms of human ZAP reduced SARS-CoV-2 RNA levels, and this activity was conserved in horseshoe bat and pangolin ZAP orthologues. Our findings indicating that type II interferon is particularly efficient against SARS-CoV-2 and that ZAP restricts this pandemic viral pathogen might promote the development of effective immune therapies against COVID-19.