Proprotein processing is essential for HIV infectivity. Cellular trans-Golgi network (TGN) serine proteases (e.g., furin) are required to cleave HIV envelope gp160 to gp120. In addition, HIV protease (PR), an aspartyl protease, cleaves p55(Gag) to p24, etc., in budding virions. alpha1-Antitrypsin (alpha(1)AT) is cleaved by serine proteases, causing a conformational change in alpha(1)AT that sequesters and so inactivates the protease. alpha(1)AT blocks both gp160 and p55 processing, and so is a powerful inhibitor of HIV replication. We hypothesized that alpha(1)AT inhibited gp160 and p55 processing via different mechanisms, and that in both cases, alpha(1)AT bound and was itself cleaved by the proteases whose activities were blocked. alpha(1)AT delivered by SV(AT), a recombinant, Tag-deleted SV40-derived vector, localized to the TGN, co-precipitated with furin, and depleted furin from the TGN. After SV(AT) transduction and HIV challenge, alpha(1)AT was detected in resulting nascent immature HIV-1 virions. alpha(1)AT also blocked incorporation of the enzymatically active dimeric form of PR into HIV virions. Western analysis using recombinant proteins showed that alpha(1)AT directly bound HIV PR, and was cleaved by it. The simultaneous inhibition of two different steps in HIV morphogenesis both increases alpha(1)AT antilentiviral activity and decreases the possibility that HIV mutations will allow escape from inhibition.