Replication of human immunodeficiency virus type 1 (HIV-1) is increased by different cytokines and T cell activators, also known to modulate tyrosine phosphorylation levels. A novel class of protein tyrosine phosphatase (PTP) inhibitors, peroxovanadium (pV) compounds, were tested for a putative effect on HIV-1 long terminal repeat (LTR) activity. We found that these PTP inhibitors markedly enhanced HIV-1 LTR activity in 1G5 cells, a stably transfected cell line that harbors an HIV-1 LTR-driven luciferase construct. A direct correlation between the extent of tyrosine phosphorylation and the level of HIV-1 LTR inducibility was seen after treatment with three different pV compounds. Transient transfection experiments were carried out in several T cell lines, and after addition of pV, a marked increase in HIV-1 LTR activity was measured. Monocytoid cells were tested using U937-derived cell lines and were also found to be sensitive to the pV-mediated potentiating effect on HIV-1 LTR activity. A significant reduction of the pV-mediated increase in HIV-1 LTR activity was seen in cells transiently transfected with an HIV-1 LTR-driven luciferase construct bearing a mutation in both NF-kappaB binding sites although detectable levels of induction remained. Electrophoretic mobility shift assays allowed the identification of the nuclear translocation of the NF-kappaB p50.p65 heterodimer complex induced by pV compounds. A dominant negative version of the repressor IkappaBalpha mutated on serines 32 and 36 impeded pV-induced NF-kappaB-dependent luciferase activity. Western blot analysis showed a clear diminution in the protein level of IkappaBalpha starting 30 min after pV treatment of Jurkat E6.1 cells which is indicative of its degradation. On the other hand, no increase in tyrosine phosphorylation was observed on IkappaBalpha itself. Finally, we tested the PTP inhibitors on four cell lines latently infected with HIV-1 and showed a consistent pV-mediated increase in virion production. Thus, our studies suggest that pV-mediated activation of HIV-1 LTR activity is controlled by the nuclear translocation of the NF-kappaB transcription factor, which is mediated by IkappaBalpha serine phosphorylation and degradation, but also by a still undefined NF-kappaB-independent pathway.