Autophagy is an essential degradation process which is finely regulated by more than 40 autophagy-related genes (ATGs) in mammals, while the understanding of ATGs in fish is limited. In this study, autophagy related 4C cysteine peptidase (ATG4C) was identified and functionally analysed in grass carp (Ctenopharyngodon idella). Expression patterns analysis showed that ATG4C was widely distributed in the grass carp tissues and mainly riched in the intestine. After grass carp reovirus (GCRV) infection, ATG4C showed a potent response in the main immune tissues, indicating that it was involved in GCRV-induced immune responses. Moreover, autophagy and apoptosis induced by GCRV invasion were confirmed by multiple methods. Further analysis showed that ATG4C positively facilitated autophagy activation but restricted apoptosis pathway, which further inhibited GCRV replication. Taken together, this study emphasizes the pivotal role of ATG4C in anti-GCRV defense and provides a new targeting for therapeutic strategy against grass carp hemorrhagic disease.