The Gag polyprotein of HIV-1 is essential for retroviral replication and packaging. The nucleocapsid (NC) protein is the primary region for the interaction of Gag with nucleic acids. In this study, we examine the interactions of Gag and its NC cleavage products (NCp15, NCp9 and NCp7) with nucleic acids using solution and single molecule experiments. The NC cleavage products bound DNA with comparable affinity and strongly destabilized the DNA duplex. In contrast, the binding constant of Gag to DNA was found to be approximately 10-fold higher than that of the NC proteins, and its destabilizing effect on dsDNA was negligible. These findings are consistent with the primary function of Gag as a nucleic acid binding and packaging protein and the primary function of the NC proteins as nucleic acid chaperones. Also, our results suggest that NCp7's capability for fast sequence-nonspecific nucleic acid duplex destabilization, as well as its ability to facilitate nucleic acid strand annealing by inducing electrostatic attraction between strands, likely optimize the fully processed NC protein to facilitate complex nucleic acid secondary structure rearrangements. In contrast, Gag's stronger DNA binding and aggregation capabilities likely make it an effective chaperone for processes that do not require significant duplex destabilization.