Human macrophage hybridoma cells were used to study HLA-DR expression after HIV-1 infection. HLA-DR surface expression was lost 2 wk after infection that was associated with decreased mRNA transcription. Transfecting HLA-DR-α and HLA-DR-β cDNA driven by a nonphysiological CMV promoter restored expression, suggesting that regulatory DNA-binding proteins may be affected by HIV-1 infection. There was no protein binding to conserved class II DNA elements (W/Z/S box, X-1 and X-2 boxes, and Y box) in a HIV-1-infected human macrophage hybridoma cell line, 43HIV, and in primary monocytes that lost HLA-DR expression after HIV-1BaL infection. PCR analysis of the HIV-1-infected cells that lost HLA-DR expression revealed mRNA for W/Z/S (RFX-5), X-1 (RFX-5), X-2 (hX-2BP), and one Y box DNA-binding protein (NF-YB), and CIITA, a non-DNA-binding protein necessary for class II transcription. There was no mRNA for the Y box-binding protein, NF-YA. However, HLA-DR expression could be restored by transfection with NF-YA driven by a CMV promoter, although HLA-DR failed to localize in either the late endosomes, lysosomes, or acidic compartments. This was associated with a loss of class II-associated invariant chain peptide and leupeptin-induced protein in the 43HIV cells. To address this further, non-HIV-1-infected 43 cells were infected with vaccinia virus containing HIV-1 gag, nef, pol, and env proteins. HLA-DR failed to localize in neither the late endosomes, lysosomes, or acidic compartments in the vaccinia-infected cells containing HIV-1 env protein. HIV-1 appears to have multiple effects on class II expression in monocytic cells that may contribute to the immune defects seen in HIV-1-infected patients.