The Nef protein enhances human immunodeficiency virus type 1 (HIV-1) replication through an unknown mechanism. We and others have previously reported that efficient HIV-1 replication in activated primary CD4(+) T cells depends on the ability of Nef to downregulate CD4 from the cell surface. Here we demonstrate that Nef greatly enhances the infectivity of HIV-1 particles produced in primary T cells. Nef-defective HIV-1 particles contained significantly reduced quantities of gp120 on their surface; however, Nef did not affect the levels of virion-associated gp41, indicating that Nef indirectly stabilizes the association of gp120 with gp41. Surprisingly, Nef was not required for efficient replication of viruses that use CCR5 for entry, nor did Nef influence the infectivity or gp120 content of these virions. Nef also inhibited the incorporation of CD4 into HIV-1 particles released from primary T cells. We propose that Nef, by downregulating cell surface CD4, enhances HIV-1 replication by inhibiting CD4-induced dissociation of gp120 from gp41. The preferential requirement for Nef in the replication of X4-tropic HIV-1 suggests that the ability of Nef to downregulate CD4 may be most important at later stages of disease when X4-tropic viruses emerge.