The HIV-1 genome consists of two identical RNA strands that are linked together through non-covalent interactions. A major determinant for efficient dimerization of the two RNA strands is the interaction between palindromic sequences in the dimerization initiation site. Here we use an interplay of bioinformatics, biochemistry, and atomic force microscopy to describe another conserved palindrome in the trans-activation response element (TAR) that functions as a strong dimerization site when transiently exposed to the viral nucleocapsid protein. In conjunction with the DIS interaction, the TAR dimerization induces the formation of a 65-nm higher-order circular structure in the dimeric HIV-1 RNA. Our results provide a molecular model for the role of TAR in packaging and reverse transcription of the viral genome. The unique structure of the TAR-TAR dimer renders it an intriguing therapeutic target for the treatment of HIV-1 infection.