Type I interferons (IFNs) are an important family of cytokines which enable the immune system to fight viral infections and cancer, and modulate the immune response. Type I IFNs are unique amongst cytokines since multiple ligands can signal through the same heterodimeric receptor composed of low (IFNAR1) and high (IFNAR2) affinity components. Despite sharing a receptor, discernible differences result from receptor engagement by different IFN subtypes. We used crystallography to determine the fine structure of IFNβ bound to the full length extracellular domain (ECD) of IFNAR1 and demonstrate unique interaction interfaces in this complex not previously defined for other IFN-receptor complexes. In comparison to other structures of IFNAR1-IFN complexes, the IFNAR1-ECD-IFNβ structure reveals that the docking angle and thus the relative contributions of specific residues is different for IFNβ than other IFNs. With an overall buried surface area larger than other demonstrated IFNAR1-IFN interfaces, our structure elucidates a molecular basis for the higher binding affinity IFNβ has for IFNAR1 compared to other IFNs. Importantly, we also used receptor knockout mice, microarray analysis, qRT-PCR and an animal model of sepsis to reveal that the IFNAR1-IFNβ complex is functional in vivo independently of the high affinity receptor component, IFNAR2. While conventional IFN signaling requires both IFNAR1 and IFNAR2, using microarray analysis we identified a novel IFNβ signaling axis occurring in the absence of IFNAR2 that induces the expression of genes encoding chemokines, cytokines and other known and novel ISGs. Using a mouse model of sepsis we also show that it is the unique mode of IFNAR1 engagement by IFNβ that leads to lethality in this disease model. Our results reveal for the first time the unique mechanism of IFNAR receptor engagement by IFNβ, an understanding of which may aid the development of targeted therapeutics to alleviate the effects of sepsis.