Like other enveloped viruses, HIV-1 uses cellular machinery to bud from inf
ected cells. We now show that Tsg101 protein, which functions in vacuolar p
rotein sorting (Vps), is required for HIV-1 budding. The UEV domain of Tsg1
01 binds to an essential tetrapeptide (PTAP) motif within the p6 domain of
the structural Gag protein and also to ubiquitin. Depletion of cellular Tsg
101 by small interfering RNA arrests HIV-1 budding at a late stage, and bud
ding is rescued by reintroduction of Tsg101. Dominant negative mutant Vps4
proteins that inhibit vacuolar protein sorting also arrest HIV-1 and MLV bu
dding. These observations suggest that retroviruses bud by appropriating ce
llular machinery normally used in the Vps pathway to form multivesicular bo
dies.