Progressive multifocal leukoencephalopathy (PML) is a demyelinating disease of the central nervous system caused by the JC virus (JCV), a human papovavirus. PML is a relatively rare disease seen predominantly in immunocompromised individuals and is a frequent complication observed in AIDS patients. The significantly higher incidence of PML in AIDS patients than in other immunosuppressive disorders has suggested that the presence of human immunodeficiency virus type 1 (HIV-1) in the brain may directly or indirectly contribute to the pathogenesis of this disease. In the present study we have examined the expression of the JCV genome in both glial and non-glial cells in the presence of HIV-1 regulatory proteins. We find that the HIV-1-encoded trans-regulatory protein tat increases the basal activity of the JCV late promoter, JCVL, in glial cells. In a reciprocal experiment, the JCV early protein, the large tumor antigen, stimulates expression from JCVL and HIV-1 long terminal repeat promoter in both glial and non-glial cells. This trans-activation occurs at the level of RNA synthesis, as measured by the rate of transcription, stability of the message, and translation. We conclude that the presence of the HIV-1-encoded tat protein may positively affect the JCV lytic cycle in glial cells by stimulating JCV gene expression. Our results suggest a mechanism for the relatively high incidence of PML in AIDS patients than in other immunosuppressive disorders. Furthermore, our findings indicate that the HIV-1 regulatory protein tat may stimulate other viral and perhaps cellular promoters, in addition to its own.