The transactivator proteins of HIV-1 and HIV-2, Tat-1 and Tat-2, are highly homologous in the center of each molecule but are divergent in the amino and carboxy termini. The structure of Tat-1 has been extensively characterized by mutagenesis studies, whereas little is as yet known specifically about the structure of Tat-2. To characterize the Tat-2 protein, we performed a mutational analysis of the amino and carboxy termini of the fully functional first exon (99 residues) of the Tat-2 protein. We found that deletion of residues 8 through 33 in the amino terminus drastically reduced transactivation activity, whereas deletion of residues 8 through 47 largely abolished transactivation activity. We also analyzed chimeric proteins in which the amino termini of the Tat-1 and Tat-2 proteins were exchanged precisely at the first cysteine in the cysteine-rich regions. Both chimeric proteins possessed very low levels of transactivation activity, indicating that the amino termini of Tat-1 and Tat-2 are not interchangeable. Truncation mutants in the carboxy terminus were analyzed and amino acid 90 at the end of the basic domain was found to be at or near the limit of carboxy residues that can be deleted without abolishing Tat-2 function. A Tat-2 mutant truncated after residue 84 within the basic domain was found to be a transdominant mutant able to inhibit wild-type Tat-1 and wild-type Tat-2 activities. Additionally, the results of immunoprecipitations suggested that deletions in the Tat-2 amino terminus can reduce protein stability.