Chronic inflammation impairs metabolic homeostasis and is intimately correlated with the pathogenesis of type 2 diabetes. The pro-inflammatory cytokine IFN-γ is an integral part of the metabolic inflammation circuit and contributes significantly to metabolic dysfunction. The underlying mechanism, however, remains largely unknown. In the present study, we report that IFN-γ disrupts the expression of genes key to cellular metabolism and energy expenditure by repressing the expression and activity of SIRT1 at the transcription level. Further analysis reveals that IFN-γ requires class II transactivator (CIITA) to repress SIRT1 transcription. CIITA, once induced by IFN-γ, is recruited to the SIRT1 promoter by hypermethylated in cancer 1 (HIC1) and promotes down-regulation of SIRT1 transcription via active deacetylation of core histones surrounding the SIRT1 proximal promoter. Silencing CIITA or HIC1 restores SIRT1 activity and expression of metabolic genes in skeletal muscle cells challenged with IFN-γ. Therefore, our data delineate an IFN-γ/HIC1/CIITA axis that contributes to metabolic dysfunction by suppressing SIRT1 transcription in skeletal muscle cells and as such shed new light on the development of novel therapeutic strategies against type 2 diabetes.