During human immunodeficiency virus type 1 minus-strand transfer, the nucleocapsid protein (NC) facilitates annealing of the complementary repeat regions at the 3'-ends of acceptor RNA and minus-strand strong-stop DNA ((-) SSDNA). In addition, NC destabilizes the highly structured complementary trans-activation response element (TAR) stem-loop (TAR DNA) at the 3'-end of (-) SSDNA and inhibits TAR-induced self-priming, a dead-end reaction that competes with minus-strand transfer. To investigate the relationship between nucleic acid secondary structure and NC function, a series of truncated (-) SSDNA and acceptor RNA constructs were used to assay minus-strand transfer and self-priming in vitro. The results were correlated with extensive enzymatic probing and mFold analysis. As the length of (-) SSDNA was decreased, self-priming increased and was highest when the DNA contained little more than TAR DNA, even if NC and acceptor were both present; in contrast, truncations within TAR DNA led to a striking reduction or elimination of self-priming. However, destabilization of TAR DNA was not sufficient for successful strand transfer: the stability of acceptor RNA was also crucial, and little or no strand transfer occurred if the RNA was highly stable. Significantly, NC may not be required for in vitro strand transfer if (-) SSDNA and acceptor RNA are small, relatively unstructured molecules with low thermodynamic stabilities. Collectively, these findings demonstrate that for efficient NC-mediated minus-strand transfer, a delicate thermodynamic balance between the RNA and DNA reactants must be maintained.