HIV-1 encodes a number of genes that are crucial for replication in primate cells. Gag, Pol, and Env products represent the main virion components, while Tat and Rev regulate intracellular transcriptional and post-transcriptional events for the controlled expression of viral genes. Of particular interest are the HIV accessory proteins Vif, Vpr, Vpu, Vpx, and Nef, which are unique to primate lentiviruses. There is increasing evidence that these proteins operate in conjunction with specific host factors. In fact, most if not all, of the accessory proteins appear to lack catalytic activities but instead seem to function as adaptors to link viral or cellular factors to pre-existing cellular pathways. In FY 2008, we continued studies to improve our understanding of the functional interactions between HIV-1 Vif and the host restriction factor APOBEC3G. One aspect we studied was the role of APOBEC3G catalytic activity in viral restriction. A number of previous reports had suggested that catalytic deaminase activity was not mandatory for virus restriction. However, all of the studies employed transiently over-expressed APOBEC3G proteins. Our approach was to create stable cell lines of wt and deaminase-defective APOBEC3G and select cell clones with expression levels comparable to APOBEC3G in normal T cells. We found that under such physiological conditions, deaminase activity of APOBEC3G was mandatory for effective inhibition of virus replication. We further investigated the effect of APOBEC3G on viral infectivity during long-term replication in human macrophages. We found that in HIV-infected macrophages, APOBEC3G levels were down-modulated but never completely depleted. Also, the degree of down-modulation was not correlated with Vif expression levels suggesting that regulation of APOBEC3G in macrophages involves additional Vif-independent mechanisms. Finally, and surprisingly, we found that the infectivity of progeny virions rapidly declined over the course of infection despite down-modulation of APOBEC3G. Thus viral infectivity during long-term replication in macrophages is regulated by additional APOBEC3G-independent mechanism(s). Finally, we started investigating mechanisms by which Vif prevents the encapsidation of APOBEC3G. There is strong evidence that Vif has the ability to induce proteasomal degradation of APOBEC3G; however, there is also strong evidence that Vif prevents APOBEC3G encapsidation even in the absence of proteasomal degradation. We performed a series of in vitro analyses that demonstrated for the first time that Vif has the ability to facilitate or accelerate the assembly of APOBEC3G from a soluble low-molecular mass protein pool to packaging-incompetent high molecular mass complexes. Thus, we propose a model in which Vif prevents APOBEC3G encapsidation by redirecting its intracellular location away from the sites of virus assembly to intracellular structures such as stress bodies, P-bodies etc.