Human immunodeficiency virus type 1 Nef protein inhibits NF-kappa B induction in human T cells. Human immunodeficiency virus type 1 (HIV-1) can establish a persistent and latent infection in CD4+ T lymphocytes (W.C.Greene, N.Engl.J. Med.324:308-317, 1991; S.M.Schnittman, M.C.Psallidopoulos, H.C. Lane, L.Thompson, M.Baseler, F.Massari, C.H.Fox, N.P.Salzman, and A.S.Fauci, Science 245:305-308, 1989). Production of HIV-1 from latently infected cells requires host cell activation by T-cell mitogens (T.Folks, D.M.Powell, M.M.Lightfoote, S.Benn, M.A. Martin, and A.S.Fauci, Science 231:600-602, 1986; D.Zagury, J. Bernard, R.Leonard, R.Cheynier, M.Feldman, P.S.Sarin, and R.C. Gallo, Science 231:850-853, 1986). This activation is mediated by the host transcription factor NF-kappa B [G.Nabel and D.Baltimore, Nature (London) 326:711-717, 1987]. We report here that the HIV-1-encoded Nef protein inhibits the induction of NF-kappa B DNA-binding activity by T- cell mitogens. However, Nef does not affect the DNA-binding activity of other transcription factors implicated in HIV-1 regulation, including SP-1, USF, URS, and NF-AT. Additionally, Nef inhibits the induction of HIV-1- and interleukin 2-directed gene expression, and the effect on HIV-1 transcription depends on an intact NF-kappa B-binding site. These results indicate that defective recruitment of NF-kappa B may underlie Nef's negative transcriptional effects on the HIV-1 and interleukin 2 promoters. Further evidence suggests that Nef inhibits NF-kappa B induction by interfering with a signal derived from the T-cell receptor complex.