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The arenavirus nucleoprotein (NP) plays an important role in the virus' ability to block interferon (IFN) production, and its exonuclease function appears to contribute to this activity. However, efforts to analyze this contribution are complicated by the functional overlap between the exonuclease active site and a neighboring region involved in IKKε-binding and subsequent inhibition of IRF3 activation, which also plays an important role in IFN production. To circumvent this issue, we mutated a residue located away from the active site that is involved in binding of the dsRNA substrate being targeted for exonuclease digestion, i.e. H426A. We found that expression of Tacaribe virus (TCRV) NP containing this RNA-binding H426A mutation was still able to efficiently block IFN-β promoter activity in response to Sendai virus infection, despite being strongly impaired in its exonuclease activity. This was in contrast to a conventional exonuclease active site mutant (E388A), which was impaired with respect to both exonuclease activity and IFN antagonism. Importantly, growth of a recombinant virus encoding the RNA-binding mutation (rTCRV-H426A) was similar to wild-type in IFN-deficient cells, unlike the active site mutant (rTCRV-E388A), which was already markedly impaired in these cells. Further, in IFN-competent cells, the TCRV-H426A RNA-binding mutant showed more robust growth and delayed IFN-β mRNA upregulation compared to the TCRV-E388A active site mutant. Taken together, this novel mutational approach, which allows us to now dissect the different contributions of the NP exonuclease activity and IKKε-binding/IRF3 inhibition to IFN antagonism, clearly suggests that conventional exonuclease mutants targeting the active site overestimate the contribution of the exonuclease function, and that rather other IFN antagonistic functions of NP play the dominant role in IFN-antagonism.