New negative regulators of interferon (IFN) signaling, preferably with tissue specificity, are needed to develop therapeutic means to enhance the efficacy of type I IFNs (IFN-α/β) and reduce their side effects. We conducted cell-based screening for IFN signaling enhancer and discovered that luteolin, a natural flavonoid, sensitized the antiproliferative effect of IFN-α in hepatoma HepG2 cells and cervical carcinoma HeLa cells. Luteolin promoted IFN-β-induced janus kinase/signal transducer and activator of transcription (JAK/STAT) pathway activation by enhancing the phosphorylation of Jak1, Tyk2, and STAT1/2, thereby promoting STAT1 accumulation in the nucleus and endogenous IFN-α-regulated gene expression. Of interest, inhibition of phosphodiesterase (PDE) abolished the effect of IFN-β and luteolin on STAT1 phosphorylation. Luteolin also increased the cAMP-degrading activity of PDE bound with type I interferon receptor 2 (IFNAR2) and decreased the intracellular cAMP level, indicating that luteolin may act on the JAK/STAT pathway via PDE. Protein kinase A (PKA) was found to negatively regulate IFN-β-induced JAK/STAT signaling, and its inhibitory effect was counteracted by luteolin. Pull-down and immunoprecipitation assays revealed that type II PKA interacted with IFNAR2 via the receptor for activated C-kinase 1 (RACK-1), and such interaction was inhibited by luteolin. Src homology domain 2 containing tyrosine phosphatase-2 (SHP-2) was further found to mediate the inhibitory effect of PKA on the JAK/STAT pathway. These data suggest that PKA/PDE-mediated cAMP signaling, integrated by RACK-1 to IFNAR2, may negatively regulate IFN signaling through SHP-2. Inhibition of this signaling may provide a new way to sensitize the efficacy of IFN-α/β.