Viruses manipulate the complex interferon and interferon-stimulated gene (ISG) system in different ways. We have previously shown that HIV inhibits type I and III interferons in its key target cells but directly stimulates a subset of >20 ISGs in macrophages and dendritic cells, many of which are antiviral. Here, we examine the mechanism of induction of ISGs and show this occurs in two phases. The first phase was transient (0 to 24 h postinfection [hpi]), induced mainly by extracellular vesicles and one of its component proteins, HSP90α, contained within the HIV inoculum. The second, dominant, and persistent phase (>48 hpi) was induced via newly transcribed HIV RNA and sensed via RIGI, as shown by the reduction in ISG expression after the knockdown of the RIGI adaptor, MAVS, by small interfering RNA (siRNA) and the inhibition of both the initiation and elongation of HIV transcription by short hairpin RNA (shRNA) transcriptional silencing. We further define the induction pathway, showing sequential HIV RNA stimulation via Tat, RIGI, MAVS, IRF1, and IRF7, also identified by siRNA knockdown. IRF1 also plays a key role in the first phase. We also show that the ISGs IFIT1 to -3 inhibit HIV production, measured as extracellular infectious virus. All induced antiviral ISGs probably lead to restriction of HIV replication in macrophages, contributing to a persistent, noncytopathic infection, while the inhibition of interferon facilitates spread to adjacent cells. Both may influence the size of macrophage HIV reservoirs in vivo Elucidating the mechanisms of ISG induction may help in devising immunotherapeutic strategies to limit the size of these reservoirs.IMPORTANCE HIV, like other viruses, manipulates the antiviral interferon and interferon-stimulated gene (ISG) system to facilitate its initial infection and establishment of viral reservoirs. HIV specifically inhibits all type I and III interferons in its target cells, including macrophages, dendritic cells, and T cells. It also induces a subset of over 20 ISGs of differing compositions in each cell target. This occurs in two temporal phases in macrophages. Extracellular vesicles contained within the inoculum induce the first, transient phase of ISGs. Newly transcribed HIV RNA induce the second, dominant ISG phase, and here, the full induction pathway is defined. Therefore, HIV nucleic acids, which are potent inducers of interferon and ISGs, are initially concealed, and antiviral ISGs are not fully induced until replication is well established. These antiviral ISGs may contribute to persistent infection in macrophages and to the establishment of viral reservoirs in vivo.