Astrocyte dysregulation correlates with the severity and the rate of human immunodeficiency virus (HIV)-associated dementia (HAD) progression, highlighting a pivotal role for astrocytes in HIV neuropathogenesis. Yet, astrocytes limit HIV, indicating that they possess an intrinsic molecular mechanism to restrict HIV replication. We previously established that this restriction can be partly overcome by priming astrocytes with gamma interferon (IFN-gamma), which is elevated in the cerebral spinal fluid of HAD patients. We evaluated the mechanism of restrictive HIV replication in astrocytes and how IFN-gamma priming modulates this restriction. We demonstrate that the downstream effector of Wnt signaling, T-cell factor 4 (TCF-4), is part of a transcriptional complex that is immunoprecipitated with HIV TAR-containing region in untreated astrocytes but not in IFN-gamma-treated cells. Blocking TCF-4 activity with a dominant-negative mutant enhanced HIV replication by threefold in both the astrocytoma cell line U87MG and primary fetal astrocytes. Using a TCF-4 reporter plasmid, we directly demonstrate that Wnt signaling is active in human astrocytes and is markedly reduced by IFN-gamma treatment. Collectively, these data implicate TCF-4 in repressing HIV replication and the ability of IFN-gamma to regulate this restriction by inhibiting TCF-4. Given that TCF-4 is the downstream effector of Wnt signaling, harnessing Wnt signaling as an intrinsic molecular mechanism to limit HIV replication may emerge as a powerful tool to regulate HIV replication within and outside of the brain.