A system and method for effectively managing telephone functionality by utilizing a settop box may preferably include a television coupled to the settop box for displaying television programming from a television programming source, and a telephone coupled to the settop box for receiving telephone calls from a telephone network. The settop box may include a TV mute manager for controlling a television mute mode that may be activated to mute audio programming on the television when receiving incoming telephone calls. The settop box may further include a caller ID manager that controls a caller ID mode that may be activated to display caller identifications on the television when receiving incoming telephone calls. The settop box may also include a phone mute manager that controls a telephone mute mode that may be activated to mute telephone ringing when receiving incoming telephone calls.