The HIV Tat protein, primarily characterized as a transcriptional activator of the viral long terminal repeat (LTR), is also a potent repressor of major histocompatibility complex (MHC) class I transcription. In the present study, we demonstrate that these two functional activities are distinct and mediated by discrete, but overlapping, structural domains of Tat. Tat repressor activity depends on C-terminal sequences, whereas transactivation depends on N-terminal sequences; both functions require core sequences. The repressor activity requires a domain encompassing the region encoded by the second exon of the Tat gene, beginning at amino acid 73, with a C-terminal limit between amino acids 80 and 83. Tat repressor function also depends on the presence of a lysine at position 41, located within the core of the protein. Tat repressor activity is independent of two N-terminal domains essential for transactivation: the acidic segment and the cysteine-rich region. Conversely, Tat transactivation is independent of the second exon-encoded region of Tat. As further support for this novel model of separable Tat functions, we show that in murine fibroblasts, Tat represses class I promoter activity, but does not transactivate the HIV LTR. We propose that distinct structural domains mediate the two functionally distinct activities associated with the Tat protein.