HIV-1 protease inhibitors (PIs) are among the most effective antiretroviral drugs. They are characterized by highly cooperative dose-response curves that are not explained by current pharmacodynamic theory. An unresolved problem affecting the clinical use of PIs is that patients who fail PI-containing regimens often have virus that lacks protease mutations, in apparent violation of fundamental evolutionary theory. Here, we show that these unresolved issues can be explained through analysis of the effects of PIs on distinct steps in the viral life cycle. We found that PIs do not affect virion release from infected cells but block entry, reverse transcription, and post-reverse transcription steps. The overall dose-response curves could be reconstructed by combining the curves for each step using the Bliss independence principle, showing that independent inhibition of multiple distinct steps in the life cycle generates the highly cooperative dose-response curves that make these drugs uniquely effective. Approximately half of the inhibitory potential of PIs is manifest at the entry step, likely reflecting interactions between the uncleaved Gag and the cytoplasmic tail (CT) of the Env protein. Sequence changes in the CT alone, which are ignored in current clinical tests for PI resistance, conferred PI resistance, providing an explanation for PI failure without resistance.