Neutrophilic inflammation characterizes several respiratory viral infections, including COVID-19–related acute respiratory distress syndrome, although its contribution to disease pathogenesis remains poorly understood. Blood and airway immune cells from 52 patients with severe COVID-19 were phenotyped by flow cytometry. Samples and clinical data were collected at 2 separate time points to assess changes during ICU stay. Blockade of type I interferon and interferon-induced protein with tetratricopeptide repeats 3 (IFIT3) signaling was performed in vitro to determine their contribution to viral clearance in A2 neutrophils. We identified 2 neutrophil subpopulations (A1 and A2) in the airway compartment, where loss of the A2 subset correlated with increased viral burden and reduced 30-day survival. A2 neutrophils exhibited a discrete antiviral response with an increased interferon signature. Blockade of type I interferon attenuated viral clearance in A2 neutrophils and downregulatedIFIT3and key catabolic genes, demonstrating direct antiviral neutrophil function. Knockdown ofIFIT3in A2 neutrophils led to loss of IRF3 phosphorylation, with consequent reduced viral catabolism, providing the first discrete mechanism to our knowledge of type I interferon signaling in neutrophils. The identification of this neutrophil phenotype and its association with severe COVID-19 outcomes emphasizes its likely importance in other respiratory viral infections and potential for new therapeutic approaches in viral illness.