We define a new interactive differentially private mechanism -- the median mechanism -- for answering arbitrary predicate queries that arrive online. Relative to fixed accuracy and privacy constraints, this mechanism can answer exponentially more queries than the previously best known interactive privacy mechanism (the Laplace mechanism, which independently perturbs each query result). Our guarantee is almost the best possible, even for non-interactive privacy mechanisms. Conceptually, the median mechanism is the first privacy mechanism capable of identifying and exploiting correlations among queries in an interactive setting. We also give an efficient implementation of the median mechanism, with running time polynomial in the number of queries, the database size, and the domain size. This efficient implementation guarantees privacy for all input databases, and accurate query results for almost all input databases. The dependence of the privacy on the number of queries in this mechanism improves over that of the best previously known efficient mechanism by a super-polynomial factor, even in the non-interactive setting.