Interferons (IFNs) are essential components of the host innate immune system and define first-line of defence against pathogens. In mammals, several type I IFNs are identified, however, only limited data is available on the repertoire of IFNs in avian species. Here we report the characterization of chicken IFN-kappa (chIFN-kappa) near the type I IFN locus on the sex-determining Z chromosome. Genetic, evolutionary and syntenic analyses indicate that chIFN-kappa is a type I IFN with conserved genetic features and promoter binding sites. chIFN-kappa regulated the IFN-stimulated response element signalling pathways and activated a panel of IFN-regulated genes, antiviral mediators and transcriptional regulators. Priming of chicken primary fibroblasts and tracheal organ cultures with chIFN-kappa imparted cellular protections against viral infections both in vitro and ex vivo. To determine whether chIFN-kappa defines the antiviral state in developing chicken embryos, we used replication-competent retroviral RCAS vector system to generate transgenic chicken embryos that constitutively and stably expressed chIFN-kappa. We could demonstrate that chIFN-kappa markedly inhibited the replication of avian RNA viruses in ovo. Collectively, these results shed the light on the repertoire of IFNs in avian species and provide functional data on the interaction of the chIFN-kappa with RNA viruses of poultry and public health importance.