Fuzeon (also known as T-20 or enfuvirtide), one of the C-peptides derived from the HIV-1 envelope glycoprotein transmembrane subunit gp41 C-terminal heptad repeat (CHR) region, is the first member of a new class of anti-HIV drugs known as HIV fusion inhibitors. It has been widely believed that T-20 shares the same mechanism of action with C34, another C-peptide. The C34 is known to compete with the CHR of gp41 to form a stable 6-helix bundle (6-HB) with the gp41 N-terminal heptad repeat (NHR) and prevent the formation of the fusogenic gp41 core between viral gp41 NHR and CHR, thereby inhibiting fusion between viral and target cell membranes. Here we present data to demonstrate that, contrary to this belief, T-20 cannot form stable 6-HB with N-peptides derived from the NHR region, nor can it inhibit the 6-HB formation of the fusogenic core. Instead, it may interact with N-peptides to form unstable or insoluble complexes. Our data suggest that T-20 has a different mechanism of action from C34. The interaction of T-20 with viral NHR region alone may not prevent the formation of the fusion active gp41 core. We also demonstrate that the T-20-mediated anti-HIV activity can be significantly abrogated by peptides derived from the membrane-spanning domain in gp41 and coreceptor binding site in gp120. These new findings imply that T-20 inhibits HIV-1 entry by targeting multiple sites in gp41 and gp120. Further elucidation of the mechanism of action of T-20 will provide new target(s) for development of novel HIV entry inhibitors.