Although psychoactive drugs are commonly used by AIDS patients, it is unclear whether commonly abused drugs, such as cocaine and ethanol, affect the course of HIV-associated dementia (HADC). Epidemiological studies have resulted in conflicting conclusions as to what role, if any, abused drugs play in HADC. In this review we discuss the clinical and pathological evidence that cocaine and ethanol might exacerbate the detrimental effects of HIV infection on the brain. We also review studies of cocaine and ethanol effects on various components of the immune system both in the presence and absence of retroviral infection. Data from these studies indicate that cocaine and ethanol have profound effects on the immune system that, in many respects, are enhanced by retroviral infection. We conclude that abused drugs likely affect the course of HADC but that proof awaits an examination of their interactive effects in an appropriate in vivo system of retroviral encephalitis.