CD8+ and CD8- subsets of peripheral blood natural killer (NK) cells were examined for susceptibility to infection with human immunodeficiency virus type 1 (HIV-1) and for the ability to produce various types of interferon (IFN) and tumor necrosis factor (TNF). HIV-1 was preferentially grown in CD8+ NK cells. The ability of CD8- NK cells to suppress HIV-1 replication was related to their ability to produce alpha IFN (IFN-alpha) upon viral induction. Induction with interleukin-2 resulted in IFN-gamma production in both subsets of NK cells. In the CD8+ subset, IFN-gamma and HIV-1 mutually enhanced the production of TNF alpha, leading to hyperactivation of viral replication, whereas in CD8- NK cells IFN-gamma primed HIV-induced IFN-alpha production. The dichotomous effects of IFN-gamma on HIV-1 replication were dependent on the IFN-alpha-producing ability of the cellular targets. These findings can explain the selective depletion of the CD16+ CD8+ subset that begins early in the in vivo HIV-1 infection.