Human immunodeficiency virus type 1 (HIV-1) infection is initiated by the binding of the viral envelope protein gp120 to the host cell CD4 receptor through a high-affinity interaction involving amino acids 39-60 within the CD4. We obtained evidence demonstrating functional importance of this region in CD4 for viral infectivity by showing that a synthetic peptide corresponding to this CD4 sequence exhibited competitive binding to gp120 and significantly reduced infection by diverse HIV-1 strains, including primary isolates. Treatment of HIV-1-infected cells with this CD4 peptide induced shedding of gp120 and exposure of the transmembrane protein gp41. Furthermore, we observed that deletion or substitution of arginine at position 59 (Arg(59)) within the CD4 peptide sequence abrogated its gp120-shedding property. These results indicate a critical role for Arg(59) in the CD4 for conformational changes in gp120 during the sequential process of entry and infection by HIV-1.