CTLA-4 is a negative regulator of T-cell receptor-mediated CD4⁺ T-cell activation and function. Upregulation of CTLA-4 during human immunodeficiency virus type 1 (HIV-1) infection on activated T cells, particularly on HIV-specific CD4⁺ T cells, correlates with immune dysfunction and disease progression. As HIV-1 infects and replicates in activated CD4⁺ T cells, we investigated mechanisms by which HIV-1 modulates CTLA-4 expression to establish productive viral infection in these cells. Here, we demonstrate that HIV-1 infection in activated CD4⁺ T cells was followed by Nef-mediated downregulation of CTLA-4. This was associated with a decreased T-cell activation threshold and significant resistance to CTLA-4 triggering. In line with these in vitro results, quantification of pro-viral HIV DNA from treatment-naive HIV-infected subjects demonstrated a preferential infection of memory CD4⁺CTLA-4⁺ T cells, thus identifying CTLA-4 as a biomarker for HIV-infected cells in vivo. As transcriptionally active HIV-1 and Nef expression in vivo were previously shown to take place mainly in the CD3⁺CD4^–CD8^– [double-negative (DN)] cells, we further quantified HIV DNA in the CTLA-4⁺ and CTLA-4^– subpopulations of these cells. Our results showed that DN T cells lacking CTLA-4 expression were enriched in HIV DNA compared with DN CTLA-4⁺ cells. Together, these results suggested that HIV-1 preferential infection of CD4⁺CTLA-4⁺ T cells in vivo was followed by Nef-mediated concomitant downregulation of both CD4 and CTLA-4 upon transition to productive infection. This also highlights the propensity of HIV-1 to evade restriction of the key negative immune regulator CTLA-4 on cell activation and viral replication, and therefore contributes to the overall HIV-1 pathogenesis.