Infants vertically infected with human immunodeficiency virus type 1 (HIV-1) often manifest profoundly deficient growth with failure to thrive. The pathologic mechanisms that produce growth failure associated with pediatric HIV infection are not clear. Transgenic mice homozygous for agag/poldeletion mutant of the infectious pro virus pNL4–3 have been found to manifest a similar growth failure pattern. To explore the influence of HIV-1 on fetal growth and maternal-fetal interactions, we examined intrauterine growth of transgenic and nontransgenic mice and evaluated the consequence of embryo transfer into normal and heterozygous transgenic mothers. Mice homozygous for the HIV transgene had normal intrauterine and birth weights but uniformly displayed severe growth retardation postnatally. Transgene expression was prominent in transgenic fetuses and their placentas and in uteri of transgenic mothers, as determined by Northern analysis. Although embryo transfer did not affect intrauterine growth, the pregnancy rate in transgenic mothers was markedly lower than in nontransgenic controls. In both fetal and neonatal tissues, transgene expression was significantly greater in homozygous animals when compared with heterozygotes, but the difference was magnified postnatally. These results suggest that HIV gene expression affected both mother and neonate. In the mother, expression of the HIV-1 transgene reduced postfertilization pregnancy rate. Once the animal was pregnant, however, the effects of transgene expression on the homozygous fetus were overcomein utero, possibly by the contribution of maternal factors or by inhibition of HIV-1 gene expression by a fetal or maternal factor(s). In the neonate, HIV-1 transgene expression increased dramatically in homozygotes and was associated with profound growth failure. Thus, the expression of HIV-1 and its consequences are complex and dependent on important maternal-fetal interactions.