Liver fibrogenesis is a process tightly controlled by endogenous anti- and pro-fibrogenic factors. Interferon gamma (IFNγ) is a potent antifibrogenic cytokine in vitro and might therefore represent a powerful therapeutic entity. However, its poor pharmacokinetics and adverse effects, due to the presence of IFNγ receptors on nearly all cells, prevented its clinical application so far. We hypothesized that delivery of IFNγ specifically to the disease-inducing cells and concurrently avoiding its binding to nontarget cells might increase therapeutic efficacy and avoid side effects. We conjugated IFNγ to a cyclic peptide recognizing the platelet-derived growth factor beta receptor (PDGFβR) which is strongly up-regulated on activated hepatic stellate cells (HSC), the key effector cells responsible for hepatic fibrogenesis. The IFNγ conjugates were analyzed in vitro for PDGFβR-specific binding and biological effects and in vivo in acute (early) and chronic (progressive and established) carbon-tetrachloride-induced liver fibrosis in mice. The targeted-IFNγ construct showed PDGFβR-specific binding to fibroblasts and HSC and inhibited their activation in vitro. In vivo, the targeted-IFNγ construct attenuated local HSC activation in an acute liver injury model. In the established liver fibrosis model, it not only strongly inhibited fibrogenesis but also induced fibrolysis. In contrast, nontargeted IFNγ was ineffective in both models. Moreover, in contrast to unmodified IFNγ, our engineered targeted-IFNγ did not induce IFNγ-related side effects such as systemic inflammation, hyperthermia, elevated plasma triglyceride levels, and neurotropic effects. Conclusion: This study presents a novel HSC-targeted engineered-IFNγ, which in contrast to systemic IFNγ, blocked liver fibrogenesis and is devoid of side effects, by specifically acting on the key pathogenic cells within the liver.