A futures contract with an underlying instrument that pays interest. An interest rate future is a contract between the buyer and seller agreeing to the future delivery of any interest-bearing asset. The interest rate future allows the buyer and seller to lock in the price of the interest-bearing asset for a future date.

|||Interest rate futures can be based on underlying instruments such as:

    
Treasury Bills in the case of Treasury Bill Futures traded on the CME
    
Treasury Bonds  in the case of Treasury Bond Futures traded on the CBT
    
Other products such as CDs, Treasury Notes and Ginnie Mae's are also available to trade as underlying assets in an interest rate future 

Because interest rate futures contracts are large in size (i.e. $1 million for Treasury Bills), they are not a product for the less sophisticated trader.