Different strains of human immunodeficiency virus type 1 (HIV-1) show considerable divergence in genetic content and biological properties. One property that has been closely correlated with clinical prognosis is the ability to induce syncytia formation in susceptible cells. This ability had been correlated with the V3 loop sequence of major envelope glycoprotein, gp120, but recent reports have questioned this connection. We investigated the contributions of different regions of the env gene to syncytia induction using chimeric viruses that contain part of the genome of a strain that lacks this ability (HIV-1(Ba-L)) within the genome of a virus that can form syncytia (HIV-1(HXB-2)). When tested in two cell lines susceptible to both parental viruses, as well as in primary cells, these chimeric viruses demonstrated that the ability to induce syncytia formation was determined by regions of env outside the V3 loop, which encompass residues that contribute to the binding of CD4 by gp120. Further investigation failed to show any difference in the expression of gp120 on the cell surface or cell adhesion molecules by cells infected with SI or NSI variants that would explain the observed differences in the ability to form syncytia. Assays of relative affinity for CD4 indicated that gp120 from SI variants showed a significantly higher affinity for CD4 than gp120 from NSI variants. These observations suggest that areas of the HIV-1 env gene contributing to the CD4 binding site may also contribute to the determination of syncytium-inducing (SI) and non-syncytium-inducing (NSI) phenotypes.