Structural and functional studies were made to assess interactions between human serum albumin (HSA) and the amino-terminal peptide (FP-I; 23-residue peptide 519-541) of glycoprotein 41,000 (gp41) of human immunodeficiency virus type-1 (HIV-1). Circular dichroism (CD) spectroscopy indicated that the peptide binds to albumin with dominant alpha-helical character. Peptide binding to albumin was also examined using FP-I spin labeled at either the amino-terminal alanine (FP-II; residue 519) or methionine (FP-III; position 537). Electron spin resonance (ESR) spectra of FP-II bound to HSA at 38 degrees C indicated that the spin label at the amino-terminal residue (Ala-519) was motionally restricted. The ESR spectrum of 12-nitroxide stearate (12-NS)-labeled HSA was identical to that obtained with FP-II, indicating that the reporter groups for the 12-NS and FP-II probes are similarly bound to albumin. Contrarily, ESR spectra of HSA labeled with FP-III indicated high mobility for the reporter group (Met-537) at the aqueous-protein interface. This suggests that the N-terminal gp41 peptide binds as an alpha helix (residues 519-536) to fatty acid sites on HSA, such that Ala-519 of the peptide residues in the interior of the protein while Met-537 lies outside the protein in aqueous solution. It is also of interest that addition of HSA to human red blood cells dramatically reduced the ability of FP-I to induce hemolysis, presumably through peptide-albumin binding that inhibited FP-I interactions with red cell membranes. The significance of these results focuses on the following three points. The first is that high serum levels of albumin may limit the efficacy of anti-HIV therapies using peptides based on the N-terminal gp41 domain. The second is that the elucidation of FP-I and HSA interactions with physical techniques may provide clues on the molecular features underlying viral FP-I combination with receptors on the target cell surface. Last, the affinity of albumin for the N-terminal gp41 peptide may play a subordinate role in the blocking of HIV infectivity in vitro that has been reported for chemically modified albumins.