It is thought that complete cleavage of retroviral envelope protein into mature surface protein (SU) and transmembrane protein (TM) is critical for its assembly into virions and the formation of infectious virus particles. Here we report the identification of highly infectious, cleavage-deficient envelope mutant proteins. Substitution of aspartate for lysine 104, arginines 124 and 126, or arginines 223 and 225 strongly suppressed cleavage of the envelope precursor and yet allowed efficient incorporation of precursor molecules as the predominant species in virions that were almost as infectious as the wild-type virus. These results indicate that cleavage of the envelope precursor into mature SU and TM is not necessary for assembly into virions. Moreover, they call into question how many mature envelope protein subunits are required to complete virus entry, suggesting that a very few molecules suffice. The failure of host cell proteases to cleave these mutant proteins, whose substitutions are distal to the actual site of cleavage, suggests that the envelope precursor is misfolded, sequestering the cleavage site. In agreement with this, all cleavage mutant proteins exhibited significant losses of receptor binding, suggesting that these residues play roles in proper envelope protein folding. We also identified a charged residue, arginine 102, whose substitution suppressed envelope cleavage and allowed precursor incorporation but resulted in virions that were virtually noninfectious and that exhibited the greatest reduction in receptor binding. Placement of these cleavage mutations into envelope proteins of targeted retroviral vectors for human gene therapy may prevent loss of the modified surface proteins from virions, improving their infectivity and storage hardiness.