Germline mutations in the Folliculin (FLCN) tumor suppressor gene cause Birt-Hogg-Dubé (BHD) syndrome, a rare autosomal dominant disorder predisposing carriers to kidney tumors. FLCN is a conserved, essential gene linked to diverse cellular processes but the mechanism by which FLCN prevents kidney cancer remains unknown. Here, we show that disrupting FLCN in human renal tubular epithelial cells (RPTEC/TERT1) activates TFE3, upregulating expression of its E-box targets, including RRAGD and GPNMB, without modifying mTORC1 activity. Surprisingly, the absence of FLCN or its binding partners FNIP1/FNIP2 induces interferon response genes independently of interferon. Mechanistically, FLCN loss promotes STAT2 recruitment to chromatin and slows cellular proliferation. Our integrated analysis identifies STAT1/2 signaling as a novel target of FLCN in renal cells and BHD tumors. STAT1/2 activation appears to counterbalance TFE3-directed hyper-proliferation and may influence immune responses. These findings shed light on unique roles of FLCN in human renal tumorigenesis and pinpoint candidate prognostic biomarkers.