HIV-1 Nef protein has been known to induce downmodulation of CD4 receptor. In order to test whether the two proteins physically interact, the yeast two-hybrid system was exploited. A Saccharomyces cerevisiae strain carrying a GAL4-responsive lacZ fusion gene was cotransformed with plasmids in which the Nef and the CD4 cytoplasmic domain (CD4cd) coding sequences were fused to either the DNA binding (DB) or the activation (A) moiety of the GAL4 transcriptional activator. Both the DB-Nef + A-CD4cd and the DB-CD4cd + A-Nef combinations activated the reporter gene, weakly but specifically, as inferred by comparison with a number of controls. Reporter activation was similary observed when DB-Nef was cotransfected with the fusion A-CD4cd(aa 1-23). On the contrary, the combination DB-Nef + A-CD4cd(aa 24-40) was inactive. Also, mutating the CD4cd Leu20-Leu21 motif (known to be essential for both physiological and Nef-induced CD4 endocytosis) to Ala20-Ala21 abolished the GAL4 activity of DB-Nef + A-CD4cd. None of six DB-Nef derivatives in which Nef was partially deleted activated specifically the reporter when coexpressed with A-CD4cd. These findings suggest that CD4cd and Nef directly interact and that a largely complete Nef is required for the interaction. CD4cd aa 1-23 are sufficient for binding; in particular, the Leu20-Leu21 motif is essential. One can infer from these data that: (i) Nef-induced CD4 downmodulation involves a direct CD4-Nef contact and (ii) CD4cd Leu20-Leu21 is required in Nef-induced downmodulation, not simply as an endocytosis signal, but also as an essential component of the Nef-binding moiety.