We describe the isolation and characterization of a novel insect-specific flavivirus (ISFV), tentatively named Aripo virus (ARPV), that was isolated from Psorophora albipes mosquitoes collected in Trinidad. The ARPV genome was determined and phylogenetic analyses showed that it is a dual host associated ISFV, and clusters with the main mosquito-borne flaviviruses. ARPV antigen was significantly cross-reactive with Japanese encephalitis virus serogroup antisera, with significant cross-reactivity to Ilheus and West Nile virus (WNV). Results suggest that ARPV replication is limited to mosquitoes, as it did not replicate in the sandfly, culicoides or vertebrate cell lines tested. We also demonstrated that ARPV is endocytosed into vertebrate cells and is highly immunomodulatory, producing a robust innate immune response despite its inability to replicate in vertebrate systems. We show that prior infection or coinfection with ARPV limits WNV-induced disease in mouse models, likely the result of a robust ARPV-induced type I interferon response.