JC virus (JCV) causes progressive multifocal leukoencephalopathy, a demyelinating disease in brains of individuals with AIDS. Previous work has shown that the Tat protein, encoded by human immunodeficiency virus type 1 (HIV-1), can interact with cellular protein Puralpha to enhance both TAR-dependent HIV-1 transcription and JCV late gene transcription. Tat has been shown to activate JCV transcription through interaction with Puralpha, which binds to promoter sequence elements near the JCV origin of replication. DNA footprinting has shown that Puralpha and large T-antigen cooperatively interact at several binding sites in the origin and transcriptional control region. Overexpression of Puralpha inhibits replication initiated at the JCV origin by T-antigen. In transfected glial cells Tat reversed this inhibition and enhanced DNA replication. In an in vitro replication system maximal activation by Tat, more than sixfold the levels achieved with T-antigen alone, was achieved in the presence of Puralpha. Effects of mutant Tat proteins on both activation of replication and binding to Puralpha have revealed that Cys22 exerts a conformational effect that affects both activities. The origin of an archetypal strain of JCV was less susceptible to activation of replication by Tat relative to the rearranged Mad-1 strain. These results have revealed a previously undocumented role for Tat in DNA replication and have indicated a regulatory role for JCV origin auxiliary sequences in replication and activation by Tat.