HIV-1 is transmitted between T cells through the release of cell-free particles and through cell-cell contact. Cell-to-cell transmission is more efficient than cell-free virus transmission, mediates resistance to immune responses, and facilitates the spread of virus among T cells. However, whether HIV cell-to-cell transmission influences the establishment of HIV-1 latency has not been carefully explored. We developed an HIV-1 latency model based on the transmission of HIV-1 directly to resting CD4+ T cells by cell-cell contact. This model recapitulates the spread of HIV-1 in T-cell-dense anatomical compartments. We demonstrate that productively infected activated CD4+ T cells transmit HIV-1 to resting CD4+ T cells in a cell-contact-dependent manner. However, proviruses generated in this fashion are more difficult to induce compared to proviruses generated by cell-free infection, suggesting that cell-to-cell transmission influences the establishment and maintenance of latent infection in resting CD4+ T cells.