We report that a major subpopulation of monocyte-derived macrophages (MDMs) contains high levels of dUTP, which is incorporated into HIV-1 DNA during reverse transcription (U/A pairs), resulting in pre-integration restriction and post-integration mutagenesis. After entering the nucleus, uracilated viral DNA products are degraded by the uracil base excision repair (UBER) machinery with less than 1% of the uracilated DNA successfully integrating. Although uracilated proviral DNA showed few mutations, the viral genomic RNA was highly mutated, suggesting that errors occur during transcription. Viral DNA isolated from blood monocytes and alveolar macrophages (but not T cells) of drug-suppressed HIV-infected individuals also contained abundant uracils. The presence of viral uracils in short-lived monocytes suggests their recent infection through contact with virus producing cells in a tissue reservoir. These findings reveal new elements of a viral defense mechanism involving host UBER that may be relevant to the establishment and persistence of HIV-1 infection.