The HIV-1 accessory protein Vpu counteracts a cellular factor that restricts the release of virions from infected cells. Here we show that the interferon-induced cellular protein BST-2/HM1. 24/CD317 fulfills criteria as this factor. BST-2 is down-regulated from the cell surface by Vpu, and it is expressed constitutively in a cell-type specific manner that correlates with the virology of Vpu. Exogenous expression of BST-2 potently inhibits the release of HIV-1 virions, and suppression of its constitutive expression relieves the requirement for Vpu. Efficient down-regulation of BST-2 requires both the transmembrane, ion-channel domain and conserved serines in the cytoplasmic domain of Vpu. Endogenous BST-2 co-localizes with the HIV-1 structural protein Gag in endosomes and at the plasma membrane, suggesting that BST-2 traps virions within and on infected cells. The unusual structure of BST-2, which includes a transmembrane domain as well as a lumenal GPI-anchor, may allow it to retain nascent enveloped virions on cellular membranes, providing a novel mechanism of viral restriction counteracted by a specific viral accessory protein.