TYK2, a Janus kinase, plays both structural and catalytic roles in type I interferon (IFN) signaling. We recently reported (Rani, M. R. S., Gauzzi, C., Pellegrini, S., Fish, E., Wei, T., and Ransohoff, R. M. (1999) J. Biol. Chem. 274, 1891-1897) that catalytically active TYK2 was necessary for IFN-beta to induce the beta-R1 gene. We now report IFN-beta-mediated activation of STATs and other components in U1 (TYK2-null) cell lines that were complemented with kinase-negative (U1.KR930) or wild-type TYK2 (U1.wt). We found that IFN-beta induced phosphorylation on tyrosine of STAT3 in U1.wt cells but not in U1.KR930 cells, whereas STAT1 and STAT2 were activated in both cell lines. Additionally, IFN-beta-mediated phosphorylation of interferon-alpha receptor-1 (IFNAR-1) was defective in IFN-beta treated U1.KR930 cells, but evident in U1.wt cells. In U1A-derived cells, the p85/p110 phosphoinositol 3-kinase isoform was associated with IFNAR-1 but not STAT3, and the association was ligand-independent. Further, IFN-beta treatment stimulated IFNAR-1-associated phosphoinositol kinase activity equally in either U1.wt or U1.KR930 cells. Our results indicate that catalytically active TYK2 is required for IFN-beta-mediated tyrosine phosphorylation of STAT3 and IFNAR-1 in intact cells.