Human immunodeficiency virus type 1 (HIV-1) strains having a dipeptide insertion between codons 69 and 70 of the viral reverse transcriptase (RT) have been observed in isolates from patients treated with 3'-azido-3'-deoxythymidine (AZT) and other nucleoside analogues. These viruses contain additional mutations related to drug resistance and display reduced susceptibility to most nucleoside analogue inhibitors, including AZT. The mechanism of AZT resistance implies an increased ability of the multidrug-resistant (SS) RT to remove AZT-monophosphate (AZTMP) from blocked primers through a nucleotide-dependent reaction. We show that its higher ATP-dependent phosphorolytic activity is also detectable with primers terminated with 2',3'-didehydro-3'-deoxythymidine-5'-monophosphate (d4TMP) or 2',3'-dideoxythymidine-5'-monophosphate (ddTMP), but is significantly reduced when the dipeptide insertion is deleted. Removal of AZTMP, d4TMP and ddTMP can be inhibited by the next complementary deoxynucleoside triphosphate (dNTP). AZTMP removal reactions catalysed by SS RT were highly resistant to dNTP inhibition (IC(50)>0.25mM), while unblocking of d4TMP- and ddTMP-terminated primers was around tenfold more sensitive to inhibition by the next complementary dNTP. Both SS and mutant 2S0S RTs were able to unblock and extend primers terminated with 2',3'-dideoxycytidine-5'-monophosphate (ddCMP) in the presence of ATP, albeit very poorly. Under these conditions, none of the RTs was able to remove 2',3'-dideoxy-3'-thiacytidine-5'-monophosphate (3TCMP) from a terminated DNA primer. Resistance mediated by ATP-dependent phosphorolysis depends on the intracellular levels of dNTP. High levels as found in transformed cell lines (i.e. H-9, CEM lymphoblasts, SupT1 cells, etc.) may prevent repair of primers terminated with d4TMP. However, ATP-dependent phosphorolysis could be relevant for d4T resistance in cells having low levels of dNTPs. This proposal could explain why insertion-containing HIV-1 variants have been detected in the absence of AZT, during d4T treatment.