Interferon (IFN) is a type of cytokine with broad-spectrum antiviral and immunomodulatory effects. Its traditional administration routes, including intravenous injection and topical application, impose certain limitations on clinical practice. In recent years, nebulized inhalation of IFN has offered a local antiviral pathway for viral respiratory infection. This review showed that nebulized inhalation of IFN can act directly on the respiratory tract, exerting broad-spectrum antiviral and immunomodulatory effects locally with minimal systemic drug exposure. Available clinical evidence suggested that nebulized inhalation of IFN yields certain therapeutic effects and acceptable safety in infants and young children with bronchiolitis, viral pneumonia and other related diseases. Local irritant reactions were common, while systemic adverse reactions were significantly fewer than injection administration. Nevertheless, high-quality evidence-based evidence was insufficient and dosing regimens had not been standardized. Currently, nebulized inhalation of IFN is mostly an off-label use. Its clinical application must strictly comply with regulatory requirements, with adequate informed consent and institutional approval. High-quality clinical trials and prospective real-world registry studies should be conducted in the future to unify dosing regimens and standardize clinical practice.