Bovine Immunodeficiency Virus (BIV) is a nonacute, pathogenic, and horizontally transmitted lentivirus. It shares the parallel properties in morphology and genetics with human immunodeficiency virus type 1 and other lentiviruses. BIV encodes its own transactivator (BTat), which transactivates its cognate long terminal repeat (LTR). However, the mechanism involved in the transactivation is different from that in HIV and other lentiviruses. We determined the mechanisms of BTat internalization by cells and the effect of BTat on neighboring cells. The green fluorescent protein fusion analysis indicated that the internalization of extracellular BTat was a time and dose-dependent, but endocytosis and energy-independent manner. Arginine residues in the arginine-rich motif (ARM) of BTat were definitively responsible for the internalization. Internalized BTat is predominantly present in the nucleus, resulting in LTR activation and NF-kappaB induction. These results propose that the secretion and internalization of BTat facilitates BIV in influencing neighboring cells and makes the cellular environment propitious to viral replication.