Thalidomide, a selective inhibitor of tumor necrosis factor alpha (TNF-alpha) synthesis, suppresses the activation of latent human immunodeficiency virus type 1 (HIV-1) in a monocytoid (U1) line. The inhibition is dose dependent and occurs after exposure of the cells to recombinant TNF-alpha, phorbol myristate acetate, lipopolysaccharide, and other cytokine combinations. Associated with HIV-1 inhibition is a reduction in agonist-induced TNF-alpha protein and mRNA production. Thalidomide inhibition of virus replication in the phorbol myristate acetate- and recombinant TNF-alpha-stimulated T-cell line ACH-2 is not observed. The presence of thalidomide also inhibits the activation of virus in the peripheral blood mononuclear cells of 16 out of 17 patients with advanced HIV-1 infection and AIDS. These results suggest the use of thalidomide in a clinical setting to inhibit both virus replication and the TNF-alpha-induced systemic toxicity of HIV-1 and opportunistic infections.