Papaverine (PV) has been previously identified as a promising candidate in SARS-CoV-2 repurposing screens. In this study, we further investigated both its antiviral and immunomodulatory properties. PV displayed antiviral efficacy against SARS-CoV-2 and influenza A virus (IAV) H1N1 and H5N1 in single infection as well as in co-infection. We demonstrated PV´s activity against various SARS-CoV-2 variants and identified its action at post-entry stage of the viral life cycle. Notably, treatment of air-liquid interface (ALI) cultures of primary bronchial epithelial cells with PV significantly inhibited SARS-CoV-2 levels. Additionally, PV was found to attenuate interferon (IFN) signaling independently of viral infection. Mechanistically, PV decreased the activation of the IFN-stimulated response element (ISRE) following stimulation with all three IFN types by suppressing STAT1 and STAT2 phosphorylation and nuclear translocation. Furthermore, the combination of PV with approved COVID-19 therapeutics molnupiravir and remdesivir demonstrated synergistic effects. Given its immunomodulatory effects and clinical availability, PV shows promising potential as a component for combination therapy against COVID-19.