Integration of the HIV-1 DNA into the host genome is essential for viral replication and is catalyzed by the retroviral integrase. To date, the only substrate described to be involved in this critical reaction is the linear viral DNA produced in reverse transcription. However, during HIV-1 infection, two-long terminal repeat DNA circles (2-LTRcs) are also generated through the ligation of the viral DNA ends by the host cell`s nonhomologous DNA end-joining pathway. These DNAs contain all the genetic information required for viral replication, but their role in HIV-1`s life cycle remains unknown. We previously showed that both linear and circular DNA fragments containing the 2-LTR palindrome junction can be efficiently cleaved in vitro by recombinant integrases, leading to the formation of linear 3´-processed-like DNA. In this report, using in vitro experiments with purified proteins and DNAs along with DNA endonuclease and in vivo integration assays, we show that this circularized genome can also be efficiently used as a substrate in HIV-1 integrase-mediated integration both in vitro and in eukaryotic cells. Notably, we demonstrate that the palindrome cleavage occurs via a two-step mechanism leading to a blunt-ended DNA product, followed by a classical 3´-processing reaction; this cleavage leads to integrase-dependent integration, highlighted by a 5-bp duplication of the host genome. Our results suggest that 2-LTRc may constitute a reserve supply of HIV-1 genomes for proviral integration.