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To determine the potential role of the placenta in transmission of human immunodeficiency virus (HIV) from mother to fetus, the ability of human placental tissue to support HIV type 1 (HIV-1) infection was examined. HIV-1-seronegative first-trimester placentas were maintained in culture and infected with HIV-1. Virus production, measured by HIV-1 antigen release into the supernatant, and HIV-1 DNA, identified by polymerase chain reaction, were detected for at least 12 days postinfection. Western immunoblot analysis showed Gag proteins, precursor p55, and cleavage products p24 and p17 in HIV-1-infected tissues. Double labeling of placental villi with antibodies to CD4 and placental trophoblast-specific alkaline phosphatase indicated that trophoblasts express CD4 antigen. Additionally, immunostaining of HIV-1-infected tissues with anti-p24 antibodies demonstrated HIV-1 protein expression in placental trophoblasts. Evaluation of human chorionic gonadotropin and progesterone production by the placental cultures indicated that there was a 90% decrease in human chorionic gonadotropin and a 70% decrease in progesterone production in HIV-1-infected cultures in comparison with controls. These data demonstrate that trophoblastic cells of human placenta tissue express CD4 and are susceptible to HIV-1 infection; also, placental endocrine function is decreased by HIV-1 infection. Thus, the placenta may serve as a reservoir of HIV-1 infection during pregnancy contributing to infection of the fetus, and decreased placental hormone production may result in impaired fetal development.