The AIDS incubation distribution is changing in calendar time because of treatment and changes in the surveillance definition of AIDS. To obtain reliable estimates of HIV prevalence and projections of AIDS incidence in the 1990s using the method of backcalculation, we constructed an appropriate incubation distribution for each calendar date of infection. We parameterized the impact of treatment on the incubation distribution by specifying the relative hazard for AIDS in treated versus untreated people as a function of duration of HIV infection. To account for trends in the incubation distribution, we modelled the prevalence of treatment, the distribution of treatment onset times, and the impact of the revision of the AIDS surveillance definition in 1987. We selected and evaluated backcalculation models based on consistency with external information. We defined a 'plausible range' of estimates that took into account uncertainty about the natural incubation distribution and treatment efficacy, as well as bootstrap assessment of stochastic error. Using these methods, we projected that national United States AIDS incidence will plateau during 1991-1994 at over 50,000 cases per year. Projections exhibited substantial systematic uncertainty, and we calculated a plausible range for AIDS incidence in 1994 of 42,300 to 70,700 cases. An estimated 628,000 to 988,000 cumulative HIV infections occurred as of 1 January 1991. After accounting for AIDS mortality, we estimated that 484,000 to 844,000 people were living with HIV infection on 1 January 1991. Favourable trends in HIV incidence appeared in gay men and intravenous drug users. Plausible ranges for our estimates overlapped with those from a 'stage model' approach to incorporating treatment effects in backcalculations. Our approach, however, tended to yield smaller estimates of epidemic size, mainly because the parameters used with the stage model implied that more treatment was in use and that treatment was more effective than in our model.