SUMMARYChronic infection with hepatitis C virus (HCV) is a common cause of liver cirrhosis and cancer. We performed RNA-sequencing in primary human hepatocytes activated with synthetic dsRNA to mimic HCV infection. Upstream of IFNL3 (IL28B) on chromosome 19q13.13, we discovered a novel, transiently induced region that harbors dinucleotide variant ss469415590 (TT/ΔG), which is in high linkage disequilibrium with rs12979860, a genetic marker strongly associated with HCV clearance. ss469415590-ΔG is a frame-shift variant that creates a novel primate-specific gene, designated interferon lambda 4 (IFNL4), which encodes a protein of moderate similarity with IFNL3. Compared to rs12979860, ss469415590 is more strongly associated with HCV clearance in individuals of African ancestry, whereas it provides comparable information in Europeans and Asians. Transient over-expression of IFNL4 in a hepatoma cell line induced STAT1/STAT2 phosphorylation and expression of interferon-stimulated genes. Our findings provide new insights into the genetic regulation of HCV clearance and its clinical management.