Interferon-producing cells (IPC) constitute a small population of leukocytes that secrete high levels of type I interferons in response to viruses. Although human IPC have been known for almost two decades, murine IPC have been identified only recently. Furthermore, it has been shown that IPC correspond to the enigmatic 'plasmacytoid cells' identified in human lymph nodes during infections. These breakthroughs have brought IPC to the attention of immunologists for their role in innate immunity and in shaping T cell responses. Here we review recent progress and outstanding questions in the field.