The classic anti-viral cytokine interferon (IFN)-β can be induced during parasitic infection, but relatively little is know about the cell types and signaling pathways involved. Here we show that inflammatory monocytes (IMs), but not neutrophils, produce IFN-β in response to T. gondii infection. This difference correlated with the mode of parasite entry into host cells, with phagocytic uptake predominating in IMs and active invasion predominating in neutrophils. We also show that expression of IFN-β requires phagocytic uptake of the parasite by IMs, and signaling through Toll-like receptors (TLRs) and MyD88. Finally, we show that IMs are major producers of IFN-β in mesenteric lymph nodes following in vivo oral infection of mice, and mice lacking the receptor for type I IFN-1 show higher parasite loads and reduced survival. Our data reveal a TLR and internalization-dependent pathway in IMs for IFN-β induction to a non-viral pathogen.