Neurological dysfunction in AIDS occurs in the absence of productive infection of neurons, and may involve modulation of neuronal cell function by viral or cellular products released from surrounding infected cells. The human immunodeficiency virus type 1 (HIV-1) trans-activator protein Tat may be one such factor, as it can act as a neurotoxin, induces marked morphological changes in neurons and astrocytes in primary embryonic rodent brain cultures, and is released by certain HIV-1-infected cells. In addition, Tat can alter expression of cellular genes in several non-neuronal cell types. To explore the possibility that Tat may also mediate neuronal dysfunction in AIDS through non-lethal effects on neurons, we determined the trans-activating ability of Tat in human neuronal cells. We generated human neuronal cell lines stably expressing several HIV-1 tat genes, and also tested human neuronal cells exposed to extracellular recombinant Tat protein. Both endogenously expressed Tat as well as exogenous recombinant Tat protein up-regulated HIV-1 long terminal region (LTR)-driven gene expression by several hundred-fold. Only brief exposure to recombinant Tat was necessary and no toxic effects were seen at levels sufficient for trans-activation. Furthermore, Tat significantly enhanced virus expression in neuronal cells transfected with molecular clones of HIV-1. These results show that Tat is trans-activationally active in human neuronal cells, and can be taken up from the extracellular compartment by these cells in a biologically active form. Neurons represent an important potential target for Tat-mediated cellular dysfunction.