When interacting with the CD4 receptor, the HIV gp120 envelope glycoprotein undergoes conformational changes that allow binding to the chemokine receptor. Receptor binding is proposed to lead to conformational changes in the gp41 transmembrane envelope glycoprotein involving the creation and/or exposure of a coiled coil consisting of three heptad repeat (HR) sequences. The subsequent interaction of the HR2 region of gp41 with this coiled coil results in the assembly of a six-helix bundle that promotes the fusion of the viral and target cell membranes. Here we show that CD4 binding to gp120 induces the formation and/or exposure of the gp41 HR1 coiled coil in a process that does not involve gp120 shedding and that depends on the proteolytic maturation of the gp160 envelope glycoprotein precursor. Importantly, BMS-806 and related HIV-1 entry inhibitors bind gp120 and block the CD4 induction of HR1 exposure without significantly affecting CD4 binding. Moreover, these compounds do not disrupt gp120-chemokine receptor binding or the HR1-HR2 interaction within gp41. These studies thus define a receptor-induced conformational rearrangement of gp120-gp41 that is important for both CD4-dependent and CD4-independent HIV-1 entry and is susceptible to inhibition by low-molecular-weight compounds.