The ability of the human immunodeficiency virus, type 1 (HIV-1) protein Nef to induce cytoskeleton changes in infected host cells is a key event in viral replication. In renal podocytes, we found that Nef induced loss of stress fibers and increased lamellipodia, pathological changes leading to proteinuria in HIV-associated nephropathy. These morphological changes were mediated by Nef-induced Rac1 activation and RhoA inhibition. We identified a new interaction between Nef and diaphanous interacting protein (DIP), a recently described regulator of Rho and Rac signaling. We found that the Src homology 3 binding domain of DIP and the Nef PXXP motif were required for this interaction. Nef also interacts with Vav2 in podocytes. DIP and Vav2 both interact directly with Nef in a competitive manner. DIP interacts with p190RhoGAP, and intact DIP was required for Nef-induced phosphorylation of p190RhoGAP. DIP also interacts with Vav2, and although DIP enhanced baseline phosphorylation of Vav2, it was not required for Nef-induced Vav2 activation. In Nef-infected podocytes, Src kinase induces phosphorylation of DIP, p190RhoGAP, and Vav2, leading to RhoA inhibition and Rac1 activation. Inhibition of the Nef-induced signaling pathway by using a dominant negative of either Src or DIP or siRNA for DIP or p190RhoAGAP restored RhoA activity and stress fiber formation in Nef-infected podocytes, whereas siRNA for Vav2 reduced Rac1 activity and formation of lamellipodia. We conclude that in HIV-infected podocytes, Nef, through the recruitment of DIP and p190RhoAGAP to Nef-Src complex, activates p190RhoAGAP and down-regulates RhoA activity.