Coronaviruses are of veterinary and medical importance and include highly pathogenic zoonotic viruses, such as SARS-CoV and MERS-CoV. They are known to efficiently evade early innate immune responses, manifesting in almost negligible expression of type-I interferons (IFN-I). This evasion strategy suggests an evolutionary conserved viral function that has evolved to prevent RNA-based sensing of infection in vertebrate hosts. Here we show that the coronavirus endonuclease (EndoU) activity is key to prevent early induction of double-stranded RNA (dsRNA) host cell responses. Replication of EndoU-deficient coronaviruses is greatly attenuated in vivo and severely restricted in primary cells even during the early phase of the infection. In macrophages we found immediate induction of IFN-I expression and RNase L-mediated breakdown of ribosomal RNA. Accordingly, EndoU-deficient viruses can retain replication only in cells that are deficient in IFN-I expression or sensing, and in cells lacking both RNase L and PKR. Collectively our results demonstrate that the coronavirus EndoU efficiently prevents simultaneous activation of host cell dsRNA sensors, such as Mda5, OAS and PKR. The localization of the EndoU activity at the site of viral RNA synthesis–within the replicase complex—suggests that coronaviruses have evolved a viral RNA decay pathway to evade early innate and intrinsic antiviral host cell responses.