Retroviral integrases (INs) interact with termini of retroviral DNA in the conserved 5'-C(A/G)T. For most integrases, modifications of critical moieties in the major and minor grooves of these sequences decrease 3'-processing. However, for human immunodeficiency virus type-2 (HTLV-2) IN, the replacement of the guanine with 6-methylguanine or hypoxanthine not only reduced 3'-processing, but also promoted cleavage at a second site. This novel cleavage activity required an upstream ACA, unique to the HTLV-2 U5 end. 3'-Processing assays with additional isosteric modifications at Gua and filter binding experiments revealed that the mechanism of the second site cleavage differed among the major groove, minor groove, and mismatch modifications. Importantly, the decrease in 3'-processing activity noted with the minor groove and mismatch modifications were attributed to a decrease in binding. Major groove modifications, however, decreased the level of 3'-processing, but did not affect binding. This suggests that integrase binds the viral end through the minor groove, but relies on major groove contacts for 3'-processing. Several modifications were also examined in strand transfer and disintegration substrates. HTLV-2 IN showed reduced activity with strand transfer and disintegration substrates containing major groove, but not minor groove modifications. This suggests major groove interactions at guanine also provide an important role in these reactions.