Indoleamine 2,3-dioxygenase (IDO) can locally suppress T cell-mediated immune responses. It has been shown that defective self-tolerance in early prediabetic female non-obese diabetic (NOD) mice can be attributed to the impaired interferon-gamma (IFN-γ)- induced IDO expression in dendritic cells of these animals. As IFN-γ can induce IDO in both dendritic cells and fibroblasts, we asked the question of whether there exists a similar defect in IFN-γ-induced IDO expression in NOD mice dermal fibroblasts. To this end, we examined the effect of IFN-γ on expression of IDO and its enzymatic activity in NOD dermal fibroblasts. The results showed that fibroblasts from either prediabetic (8 wks of age) female or male, and diabetic female or male (12 and 24 wks of age respectively) NOD mice failed to express IDO in response to IFN-γ treatment. To find underlying mechanisms, we scrutinized the IFN- γ signaling pathway and investigated expression of other IFN-γ-modulated factors including major histocompatibility complex class I (MHC-I) and type I collagen (COL-I). The findings revealed a defect of signal transducer and activator of transcription 1 (STAT1) phosphorylation in NOD cells relative to that of controls. Furthermore, we found an increase in MHC-I and suppression of COL-I expression in fibroblasts from both NOD and control mice following IFN-γ treatment; indicating that the impaired response to IFN-γ in NOD fibroblasts is specific to IDO gene. Finally, we showed that an IFN-γ-independent IDO expression pathway i.e. lipopolysaccharide (LPS)-mediated-c-Jun kinase is operative in NOD mice fibroblast. In conclusion, the findings of this study for the first time indicate that IFN-γ fails to induce IDO expression in NOD dermal fibroblasts; this may partially be due to defective STAT1 phosphorylation in IFN-γ-induced-IDO signaling pathway.