The nef protein is one of the regulatory proteins encoded by the human immunodeficiency virus (HIV). It has been shown to down-regulate viral transcription and displays features typical of some membrane-associated G proteins. To define the amino acid sequences involved in several of the properties of the nef protein, the corresponding gene has been submitted to a series of site-directed mutations. The mutants have been evaluated using various parameters which seem to correlate with the biological properties of nef. As previously observed for some signal transducing proteins, membrane localization and correct folding are critical for nef activity. Additionally, two domains, putative "P and G sites" which may be involved in nucleotide binding, have been identified.