Interferon-gamma (IFN-gamma) coordinates a diverse array of cellular programs through transcriptional regulation of immunologically relevant genes. This article reviews the current understanding of IFN-gamma ligand, receptor, signal transduction, and cellular effects with a focus on macrophage responses and to a lesser extent, responses from other cell types that influence macrophage function during infection. The current model for IFN-gamma signal transduction is discussed, as well as signal regulation and factors conferring signal specificity. Cellular effects of IFN-gamma are described, including up-regulation of pathogen recognition, antigen processing and presentation, the antiviral state, inhibition of cellular proliferation and effects on apoptosis, activation of microbicidal effector functions, immunomodulation, and leukocyte trafficking. In addition, integration of signaling and response with other cytokines and pathogen-associated molecular patterns, such as tumor necrosis factor-alpha, interleukin-4, type I IFNs, and lipopolysaccharide are discussed.