Many people infected with human immunodeficiency virus type 1 (HIV-1) develop neurological complications that can culminate in dementia and paralysis. The discrepancy between the severity of impairment and the paucity of detectable HIV-1 within neurons has led to an intense search for diffusible virus- and host-derived factors that might be neurotoxic (see ref. 2 for review). The HIV-1 envelope glycoprotein gp120 is an extracellular protein that is shed from infected cells and so has the potential to diffuse and interact with distant uninfected brain cells. Studies on cultured immature cells suggest that gp120 induces neurotoxicity (reviewed in refs 2, 4), and systemic injection of gp120 in neonatal rats and intracerebroventricular injection in adult rats results in deleterious effects on the brain. To assess the pathogenic potential of gp120 in the intact brain, we have now produced gp120 in the brains of transgenic mice and found a spectrum of neuronal and glial changes resembling abnormalities in brains of HIV-1-infected humans. The severity of damage correlated positively with the brain level of gp120 expression. These results provide in vivo evidence that gp120 plays a key part in HIV-1-associated nervous system impairment. This model should facilitate the evaluation and development of therapeutic strategies aimed at HIV-brain interactions.