The nef gene of human and simian immunodeficiency viruses encodes a 27-32-kDa myristoylated protein that is expressed at high levels early after infection. Many functions have been ascribed to the Nef protein, including the down-regulation of cell surface CD4 and a role in viral infectivity. This report describes a novel effect of the Nef protein on human T cells. Electron microscopy was used to examine human T cell lines stably expressing functionally active simian or human immunodeficiency virus type 1 Nef proteins. These studies revealed that the subcellular morphology of Nef-expressing cells was dramatically altered as compared with control cells. The Nef-expressing cells contained numerous membrane-bound vesicles prominently displayed throughout the cytoplasm. The vesicles were analyzed by immunoelectron microscopy (IEM) and by the accumulation of internalized nonspecific membrane tracer, and thus identified as late endosomes and lysosomes. The accumulation of endosomes and lysosomes in response to the expression of Nef was a consistent finding, observed with several different viral isolates and human T cell lines.