The CD4 molecule is a T cell surface glycoprotein that interacts with high affinity with the envelope glycoprotein of the human immunodeficiency virus, HIV, thus serving as a cellular receptor for this virus. To define the sites on CD4 essential for binding to gp120, we produced several truncated, soluble derivatives of CD4 and a series of 26 substitution mutants. Quantitative binding analyses with the truncated proteins demonstrate that the determinants for high affinity binding lie solely with the first 106 amino acids of CD4 (the V1 domain), a region having significant sequence homology to immunoglobulin variable regions. Analysis of the substitution mutants further defines a discrete binding site within this domain that overlaps a region structurally homologous to the second complementarity-determining region of antibody variable domains. Finally, we demonstrate that the inhibition of virus infection and virus-mediated cell fusion by soluble CD4 proteins depends on their association with gp120 at this binding site.