This project focuses on HIV-1 replication in cultured cells to develop understandings of viral pathogenesis and the cellular factors that influence viral gene expression. Important scientific advances that we have achieved in the 2010 to 2011 period are outlined below. We have studied how methylation of capped viral RNA regulates HIV-1 gene expression. 5'-mRNA capping is an early modification that affects pre-mRNA synthesis/splicing, RNA cytoplasmic transport, and mRNA translation and turnover. In eukaryotes, a 7-methylguanosine (m7G) cap is added to newly transcribed RNA polymerase II (RNAP II) transcripts. A subset of RNAP II-transcribed cellular RNAs, including small nuclear RNA (snRNA), small nucleolar RNA (snoRNA), and telomerase RNA, is further hypermethylated at the exocyclic N2 of the guanosine to create a trimethylguanosine (TMG)-capped RNA. Some of these TMG-capped RNAs are transported within the nucleus and from the nucleus to the cytoplasm by the CRM-1 (required for chromosome region maintenance) protein. CRM-1 is also used to export Rev/RRE-dependent unspliced/ partially spliced HIV-1 RNAs. We show that like snRNAs and snoRNAs, some Rev/RRE-dependent HIV-1 RNAs are TMG-capped. The methyltransferase responsible for TMG modification of HIV-1 RNAs is the human PIMT (peroxisome proliferator-activated receptor-interacting protein with methyltransferase) protein. TMG capping of unspliced/partially spliced HIV-1 RNAs represents a new regulatory mechanism for selective expression. We have investigated how a protein phosphatase regulates a transcription complex necessary for HIV-1 gene expression. CDK9/cyclin T1, a key enzyme in HIV-1 transcription, is negatively regulated by 7SK RNA and the HEXIM1 protein. Dephosphorylation of CDK9 on Thr(186) by protein phosphatase 1 (PP1) in stress-induced cells or by protein phosphatase M1A in normally growing cells activates CDK9. We found previously that HIV-1 Tat protein binds to PP1 through the Tat Q(35)VCF(38) sequence, which is similar to the PP1-binding RVXF motif and that this interaction facilitates HIV-1 transcription. We have analyzed the effect of expression of the central domain of nuclear inhibitor of PP1 (cdNIPP1) in an engineered cell line and also when cdNIPP1 was expressed as part of HIV-1 pNL4-3 in place of nef. Stable expression of cdNIPP1 increased CDK9 phosphorylation on Thr(186) and the association of CDK9 with 7SK RNA. The stable expression of cdNIPP1 disrupted the interaction of Tat and PP1 and inhibited HIV-1 transcription. Expression of cdNIPP1 as a part of the HIV-1 genome inhibited HIV-1 replication. We thus demonstrate that targeting PP1-activity inhibits HIV-1 replication. We have examined post-transcriptional regulation of HIV-1 gene expression. For HIV-1, post-transcriptional nuclear control allows for the export of intron-containing RNAs which are normally retained in the nucleus. Specific signals on the viral RNAs, such as instability sequences (INS) and Rev responsive element (RRE), are binding sites for viral and cellular factors that serve to regulate RNA-export. The HIV-1 encoded viral Rev protein binds to the RRE found on unspliced and incompletely spliced viral RNAs. Binding by Rev directs the export of these RNAs from the nucleus to the cytoplasm. Previously, Rev co-factors have been found to include cellular factors such as CRM1, DDX3, PIMT and others. Our findings now show that the nuclear matrix protein Matrin 3 binds Rev/RRE-containing viral RNA and serves as a Rev cofactor. Matrin 3 binding interaction stabilizes unspliced and partially spliced HIV-1 transcripts leading to increased cytoplasmic expression of these viral RNAs.