A low-molecular-weight human immunodeficiency virus type 1 (HIV-1) inhibitor, PF-68742 (molecular weight, 573), has been identified in a high-throughput screen for compounds that block HIV-1 envelope glycoprotein (Env)-mediated fusion. The compound is shown to be potent against R5 and X4 isolates in both cell-cell fusion and antiviral assays (50% effective concentrations of approximately 0.1 to 1 muM). Postfusion and HIV-1 pseudotyping control experiments confirm that PF-68742 is an entry inhibitor with Env as the specific target for antiviral action. PF-68742 was not able to block binding of monomeric gp120 to soluble CD4 or the binding of gp120:CD4 complexes to cell-associated CCR5, thus distinguishing PF-68742 from described gp120 antagonists and coreceptor binders. Escape variants of HIV-1(NL4-3) were selected, and all resistant viruses were found to contain a common G514R (HxB2 numbering) mutation in Env, located proximal to the furin cleavage site in the fusion peptide of gp41. When introduced into wild-type NL4-3 gp41, G514R conferred resistance to PF-68742. Resistance via G514R is shown to be associated with enhancement of virion infectivity by PF-68742 that may result from altered properties of inhibitor-bound Env, rather than from a loss of compound binding. Wild-type viruses and those with substitutions in the disulfide loop (DSL) region of gp41 were also examined for PF-68742 sensitivity. Here, complete resistance to PF-68742 was found to occur through changes outside of position 514, including in the gp41 DSL region. The results highlight PF-68742 as a starting point for novel therapies against HIV-1 and provide new insights into models of Env-mediated fusion.