A human T-lymphotropic virus type I (HTLV-I) strain was isolated in a CD4+ T-lymphocyte culture established from a healthy seropositive Australian Aboriginal. This isolate, identified as HTLV-IMSHR-1, was detected by immunofluorescence with monoclonal antibodies, by the presence of gag-encoded protein p24 in the culture supernatant, and by cocultivation leading to infection and transformation of lymphocytes from an HTLV-I-negative donor. By using the polymerase chain reaction technique, the env gene and segments of the pol and pX regions of the proviral genome of HTLV-I(MSHR-1) were amplified and sequenced. Comparison with the envelope sequences of prototype strains revealed up to 7% divergence at the nucleotide level and 3.1 to 4.3% divergence in the predicted amino acid sequence. Phylogenetic analysis showed that the Australian and Melanesian isolates are related. Differential reactivity with monoclonal antibodies suggests that gag protein p19 of HTLV-I(MSHR-1) is also divergent. The potential for antigenic divergence between the prototype HTLV-I isolates and the Austro-Melanesian variants requires further investigation, because it would have implications for serodiagnosis and vaccine development.