Biochemical experiments have recently revealed that the p-S8 peptide, with an amino-acid sequence identical to the conserved fragment 83-93 (S8) of the HIV-1 protease, can inhibit catalytic activity of the enzyme by interfering with protease folding and dimerization. In this study, we introduce a hierarchical modeling approach for understanding the molecular basis of the HIV-1 protease folding inhibition. Coarse-grained molecular docking simulations of the flexible p-S8 peptide with the ensembles of HIV-1 protease monomers have revealed structurally different complexes of the p-S8 peptide, which can be formed by targeting the conserved segment 24-34 (S2) of the folding nucleus (folding inhibition) and by interacting with the antiparallel termini beta-sheet region (dimerization inhibition). All-atom molecular dynamics simulations of the inhibitor complexes with the HIV-1 PR monomer have been independently carried out for the predicted folding and dimerization binding modes of the p-S8 peptide, confirming the thermodynamic stability of these complexes. Binding free-energy calculations of the p-S8 peptide and its active analogs are then performed using molecular dynamics trajectories of the peptide complexes with the HIV-1 PR monomers. The results of this study have provided a plausible molecular model for the inhibitor intervention with the HIV-1 PR folding and dimerization and have accurately reproduced the experimental inhibition profiles of the active folding inhibitors.