Interferons regulate immunity by inducing DNA-binding of the transcription factor STAT1 through Y701 phosphorylation. Transcription by STAT1 needs to be restricted to minimize adverse effects of prolonged immune responses. It remains unclear how STAT1 inactivation is regulated such that the transcription output is adequate. Here we show that efficient STAT1 inactivation in macrophages is coupled with processive transcription. Ongoing transcription feeds back to reduce promoter occupancy of STAT1 and, consequently, the transcriptional output. Once released from the promoter, STAT1 is ultimately inactivated by Y701 dephosphorylation. We observe similar regulation for STAT2 and STAT3 suggesting a conserved inactivation mechanism among STATs. These findings reveal that STAT1 promoter occupancy in macrophages is regulated such that it decreases only after initiation of the transcription cycle. This feedback control ensures the fidelity of cytokine responses and provides options for pharmacological intervention.