Methodological advancements to automate the generation of differential diagnosis (DDx) to predict a list of potential diseases as differentials given patients' symptom descriptions are critical to clinical reasoning and applications such as decision support. However, providing reasoning or interpretation for these differential diagnoses is more meaningful. Fortunately, large language models (LLMs) possess powerful language processing abilities and have been proven effective in various related tasks. Motivated by this potential, we investigate the use of LLMs for interpretable DDx. First, we develop a new DDx dataset with expert-derived interpretation on 570 public clinical notes. Second, we propose a novel framework, named Dual-Inf, that enables LLMs to conduct bidirectional inference for interpretation. Both human and automated evaluation demonstrate the effectiveness of Dual-Inf in predicting differentials and diagnosis explanations. Specifically, the performance improvement of Dual-Inf over the baseline methods exceeds 32% w.r.t. BERTScore in DDx interpretation. Furthermore, experiments verify that Dual-Inf (1) makes fewer errors in interpretation, (2) has great generalizability, (3) is promising for rare disease diagnosis and explanation.