Quantifying the dynamics of intrahost HIV-1 sequence evolution is one means of uncovering information about the interaction between HIV-1 and the host immune system. In the chronic phase of infection, common dynamics of sequence divergence and diversity have been reported. We developed an HIV-1 sequence evolution model that simulated the effects of mutation and fitness of sequence variants. The amount of evolution was described by the distance from the founder strain, and fitness was described by the number of offspring a parent sequence produces. Analysis of the model suggested that the previously observed saturation of divergence and decrease of diversity in later stages of infection can be explained by a decrease in the proportion of offspring that are mutants as the distance from the founder strain increases rather than due to an increase of viral fitness. The prediction of the model was examined by performing phylogenetic analysis to estimate the change in the rate of evolution during infection. In agreement with our modeling, in 13 out of 15 patients (followed for 3-12 years) we found that the rate of intrahost HIV-1 evolution was not constant but rather slowed down at a rate correlated with the rate of CD4+ T-cell decline. The correlation between the dynamics of the evolutionary rate and the rate of CD4+ T-cell decline, coupled with our HIV-1 sequence evolution model, explains previously conflicting observations of the relationships between the rate of HIV-1 quasispecies evolution and disease progression.