RNA silencing is a form of nucleic acid-based immunity against viruses in plants and invertebrate animals. Successful viral infection requires evasion or suppression of gene silencing. Here, we report that the core protein of Hepatitis C virus (HCV) acts as a potent suppressor of RNA silencing (SRS). We have found that the HCV core protein inhibits RNA silencing induced by short hairpin RNAs (shRNAs) but not by synthetic small interfering RNAs (siRNAs) in various mammalian cells. We have further demonstrated that HCV core protein directly interacts with Dicer, an RNase enzyme that generates siRNA in host cells. The HCV core protein has been shown to inhibit the function of Dicer to process double-stranded RNAs (dsRNAs) into siRNAs. Through deletion analysis, we have found that the N-terminal domain is required for core protein to antagonize RNA silencing activity of Dicer enzyme. Thus, our results suggest that HCV core protein may abrogate host cell RNA silencing defense by suppressing the ability of Dicer to process precursor dsRNAs into siRNAs. This anti-Dicer ability of core protein may contribute to the persistent viral infection and pathogenesis of HCV.