Interactions between the nucleocapsid protein (NC) and reverse transcriptase of HIV-1 have been shown to promote the initiation of reverse transcription. We assayed the effect of NC on later events, using a strand transfer system with donor and acceptor HIV RNA templates and found that the presence of NC resulted in increased synthesis of full-length strand-transferred (FLST) DNA. This effect also occurred with mutated forms of NC that lacked both zinc fingers, or that contained a point mutation (histidine-->cysteine) at amino acid 23. In contrast, NC-derived proteins containing only the proximal or distal zinc fingers, or lacking the N- and C-termini, were all unable to catalyze the synthesis of FLST DNA. Band-shift assays using both the mutated and wild-type forms of these proteins revealed that all the NC proteins promoted strand association between (-) strong-stop DNA [(-)ssDNA] and acceptor RNA. The zinc finger motifs were dispensable for full-length processive reverse transcription, and the N- and C-termini were required; however, all NC domains were dispensable for association of (-)ssDNA and acceptor RNA. This suggests that annealing is a less stringent reaction than DNA polymerization.