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Modifications that we introduced into the implantation of human fetal thymus and liver into SCID mice (thy/liv-SCID-hu mice) markedly increased the population of human T cells and monocytes present in the peripheral blood and peripheral lymphoid compartment of these mice. As a result, the modified thy/liv-SCID-hu mice developed disseminated HIV infection after intraimplant or i.p. inoculation. After chronic HIV infection of these mice, depletion of the peripheral human T cells was observed as reported in HIV-infected individuals. In addition, these mice also developed plasma viremia after infection with HIV. The peripheral blood mononuclear cells were responsive to in-vivo cytokine regulation as evidenced by induction of human IFN-γ gene expression by human IL-12 and inhibition by human IL-10. Acute treatment with human IL-10 but not with human IL-12 inhibited the development of plasma viremia and HIV infection in thy/liv-SCID-hu mice inoculated with HIV-1₅₉, a clinical isolate. SCID mice transplanted with cultured human fetal bone marrow displayed significant engraftment of the mouse bone marrow with human precursor cells and population of the peripheral blood with human B cells and monocytes. The peripheral blood of these bone marrow-transplanted SCID mice also became populated with human T cells after they were implanted with human thymic tissue due to migration of human precursor cells from the mouse bone marrow to the implanted human thymus. Thus, these modified SCID-hu mice should prove to be a valuable in-vivo model for studying the immunopathogenesis of HIV infection and for examining the in-vivo efficacy of immunomodulatory, drug and gene therapy in modifying HIV infection.