The neuropathogenesis of HIV-1 encephalitis and its associated dementia revolves around sustained viral replication in cells of mononuclear phagocyte origin (brain macrophages, multinucleated giant cells, and microglia). Macrophage secretory factors play important roles in facilitating monocyte trafficking into the brain, in regulating productive viral replication, and in producing neurotoxic responses. To study these events, we constructed an artificial blood-brain barrier (BBB) to assay monocyte transendothelial migration and developed an animal model system for HIV-1 encephalitis to ascertain the role that virus-infected mononuclear phagocytes play in disease pathogenesis. The BBB model was composed of brain microvascular endothelial cells and astrocytes placed on opposite sides of a porous membrane. Monocyte activation, not HIV-1 infection per se, was the central event affecting monocyte BBB migration. Many of the pathological features of HIV-1 encephalitis were reproduced in SCID mice stereotactically inoculated with virus-infected monocytes. These included widespread astrogliosis, apoptosis of neurons, dendritic damage, and macrophage/microglial activation. Such laboratory and animal model systems are being used to ascertain the pathogenic potential of virus-infected macrophages in brain and ways to curb such injurious effects.