Ionizing radiation-induced tissue damage recruits monocytes into the exposed area where they are differentiated to macrophages. These implement phagocytic removal of dying cells and elicit an acute inflammatory response, but can also facilitate tumorigenesis due to production of anti-inflammatory cytokines. Using primary human monocyte-derived macrophages (MDMs) and the THP1 monocytic cell line, we demonstrate that gamma radiation triggers monocyte differentiation toward the macrophage phenotype with increased expression of type I interferons (IFN-I) and both pro- and anti-inflammatory macrophage activation markers. We found that these changes correlate with significantly upregulated expression of 622 retroelements from various groups, particularly of several clades of human endogenous retroviruses (HERVs). Elevated transcription was detected in both sense and antisense directions in the HERV subgroups tested, including the most genetically homogeneous clade HML-2. The level of antisense transcription was three- to five-fold higher than of the sense strand levels. Using a proximity ligation assay and immunoprecipitation followed by RNA quantification, we identified an increased amount of the dsRNA receptors MDA-5 and TLR3 bound to an equivalent number of copies of sense and antisense chains of HERVK HML-2 RNA. This binding triggered MAVS-associated signaling pathways resulting in increased expression of IFN-I and inflammation related genes that enhanced the cumulative inflammatory effect of radiation-induced senescence. HML-2 knockdown was accompanied with reduced expression and secretion of IFNα, pro-inflammatory (IL-1β, IL-6, CCL2, CCL3, CCL8, and CCL20) and anti-inflammatory (IL10) modulators in irradiated monocytes and MDMs. Taken together, our data indicate that radiation stress-induced HERV expression enhances the IFN-I and cytokine response and results in increased levels of pro-inflammatory modulators along with expression of anti-inflammatory factors associated with the macrophage tumorigenic phenotype.