The nature and position of transcriptional control elements responsible for the expression of genes encoded by the retrovirus associated with acquired immune deficiency syndrome (AIDS) have not been precisely defined. In this study it is shown that the mammalian Sp1 transcription factor binds to promoter sequences within the AIDS retrovirus long terminal repeat (LTR) and activates RNA synthesis five- to eightfold in reconstituted reactions in vitro. Experiments in which regions of DNA were protected from added reagents by specifically bound proteins (footprinting) indicated that the upstream promoter region of the AIDS virus LTR lies between -45 and -77 (relative to the RNA start site, +1) and contains three tandem, closely spaced SP1 binding sites of variable affinity. Base-substitution mutations targeted to one or all three Sp1 binding sites were found both to eliminate the binding of Sp1 and to cause up to a tenfold reduction in transcriptional efficiency in vitro. These findings suggest that one important component of the AIDS virus transcriptional control region interacts with a cellular transcription factor, Sp1, and that this factor must function in conjunction with transcriptional elements located downstream of the RNA cap site to mediate the response of the LTR to viral trans-activation.