A study by Hall et al. (J Virol 1992;66:2456-2463; Ref. 11) has suggested the existence of two closely related molecular subtypes of HTLV-II, which were tentatively designated HTLV-IIa and HTLV-IIb. To confirm this nucleotide sequence analysis of 986 bp of the env gene region encoding the entire surface glycoprotein, gp46, and the amino terminus of the transmembrane glycoprotein, gp21, of 10 HTLV-II isolates was carried out. The results clearly established the existence of two subtypes and demonstrated a 4.3% divergence in sequence in this region. Analysis of other gene regions of the provirus, including the pol (1544 bp), gag (448 bp), and the entire LTR (743 bp) of two representative isolates of each subtype, showed a sequence divergence of 3.8 to 5.7%, with greatest divergence occurring in the LTR. In addition to single nucleotide changes, the gag regions encoding the structural protein, p19, of the HTLV-IIb isolates were also found to have a 66-bp deletion that would be expected to result in a p19 protein having a 22-amino acid deletion in the carboxy-terminus region. Attempts to exploit this to differentiate the two subtypes serologically were unsuccessful in that recombinant p19 proteins of both subtypes were found to be antigenically cross-reactive. The finding of two molecular subtypes of HTLV-II may have important implications for a better understanding of the biological and pathogenic properties of the virus, and will be useful in characterizing the viruses present in endemic foci in American Indian populations.