A variety of substituted 5'-N-phthaloyl-3'-azido-2',3'-dideoxythymidine derivatives has been evaluated for their activity against HIV-1, HIV-2 and Moloney murine sarcoma virus (MSV) in cell culture. Most of the 3'-azido-2',3'-dideoxythymidine (AZT, zidovudine) derivatives showed antiviral activity in the lower micromolar concentration range and there was a close correlation between their anti-HIV and anti-MSV activity (r = 0.99). The adamantyl phthaloyl derivative was active at submicromolar concentrations. None of the compounds showed marked cytostatic activity. They did not inhibit recombinant HIV-1 reverse transcriptase. All compounds were inactive against HIV in thymidine kinase-deficient cells, pointing to the compounds' requirement to release free AZT to afford antiviral efficacy.