A novel 2986-base transcript encoded by the antisense strand of the HRES-1 human endogenous retrovirus was isolated from peripheral blood lymphocytes. This transcript codes for a 218-amino acid protein, termed HRES-1/Rab4, based on homology to the Rab4 family of small GTPases. Antibody 13407 raised against recombinant HRES-1/Rab4 detected a native protein of identical molecular weight in human T cells. HRES-1 nucleotides 2151-1606, located upstream of HRES-1/Rab4 exon 1, have promoter activity when oriented in the direction of HRES-1/Rab4 transcription. The human immunodeficiency virus, type 1 (HIV-1), tat gene stimulates transcriptional activity of the HRES-1/Rab4 promoter via trans-activation of the HRES-1 long terminal repeat. Transfection of HIV-1 tat into HeLa cells or infection of H9 and Jurkat cells by HIV-1 increased HRES-1/Rab4 protein levels. Overexpression of HRES-1/Rab4 in Jurkat cells abrogated HIV infection, gag p24 production, and apoptosis, whereas dominant-negative HRES-1/Rab4(S27N) had the opposite effects. HRES-1/Rab4 inhibited surface expression of CD4 and targeted it for lysosomal degradation. HRES-1/Rab4(S27N) enhanced surface expression, recycling, and total cellular CD4 content. Infection by HIV elicited a coordinate down-regulation of CD4 and up-regulation of HRES-1/Rab4 in PBL. Moreover, overexpression of HRES-1/Rab4 reduced CD4 expression on peripheral blood CD4+ T cells. Stimulation by HIV-1 of HRES-1/Rab4 expression and its regulation of CD4 recycling reveal novel coordinate interactions between an infectious retrovirus and the human genome.