Interleukin-1 receptor-associated kinase (IRAK) family members play important roles in myeloid differentiation primary response 88 (MyD88)-dependent toll-like receptor (TLR) signaling, the crucial innate immune pathway in vertebrates. In the present study, the IRAK family gene IRAK-M (also called IRAK3) from grass carp (Ctenopharyngodon idella) was cloned and characterised. IRAK-M was mainly enriched in the spleen, and the significantly altered expression was observed after grass carp reovirus (GCRV) infection. Subcellular localisation showed that IRAK-M protein distributed uniformly in the entire cell and co-localised with MyD88 in the cytoplasm of transfected cells. Additionally, the interaction between IRAK-M and MyD88 was confirmed by bimolecular fluorescence complementation (BiFC) system. Moreover, deficient of IRAK-M in C. idella kidney cell line (CIK) with small interference RNA (siRNA) upregulated polyinosinic:polycytidylic acid (poly(I:C))-induced inflammatory cytokines production, including interleukin 8 (IL-8), IL-6, and tumour necrosis factor α (TNF-α), which reveals that IRAK-M functions as a negative regulator of inflammatory cytokines. Taken together, our results demonstrate that IRAK-M gene plays an important role in innate immune regulation and provide new insights into understanding the functional characteristics of the IRAK-M in teleosts.