The viral replication rate in patients infected with human immunodeficiency virus type 1 (HIV-1) is controlled in part by regulation of the transcription of viral genes. The rate of transcription is determined by a complex interplay between cellular and viral proteins and the promoter elements found in the long terminal repeats. Protein phosphatase 2A (PP2A) is a phosphoprotein that plays important roles in the regulation of signal transduction and cell growth. In this report, we demonstrate that overexpression of the catalytic subunit of protein phosphatase 2A (PP2Ac) increases the basal activity of the HIV-1 promoter and, especially, enhances the promoter's response to the protein kinase C (PKC) activator 12-O-tetradecanoyl phorbol-13-acetate (PMA). Additionally, ectopic PP2Ac enhances activation of HIV-1 provirus by PMA. Okadaic acid, a potent inhibitor of PP2A, markedly reduces both HIV-1 enhancer and proviral activation. Fostriecin, a PP2A inhibitor which has been used as an antineoplastic agent in clinical trials, is also able to inhibit PMA-stimulated HIV-1 proviral activation. These observations demonstrate a role for the important cellular phosphatase PP2A in HIV-1 transcription and replication and also suggest that PKC can potentiate the activity of PP2A. PP2A is a potential target for therapeutic intervention in patients infected with HIV-1.