Human immunodeficiency virus type 1 (HIV-1) clade C causes >50% of all HIV infections worldwide, and an estimated 90% of all transmissions occur mucosally with R5 strains. A pathogenic R5 simian-human immunodeficiency virus (SHIV) encoding HIV clade C env is highly desirable to evaluate candidate AIDS vaccines in nonhuman primates. To this end, we generated SHIV-1157i, a molecular clone from a Zambian infant isolate that carries HIV clade C env. SHIV-1157i was adapted by serial passage in five monkeys, three of which developed peripheral CD4⁺ T-cell depletion. After the first inoculated monkey developed AIDS at week 137 postinoculation, transfer of its infected blood to a naïve animal induced memory T-cell depletion and thrombocytopenia within 3 months in the recipient. In parallel, genomic DNA from the blood donor was amplified to generate the late proviral clone SHIV-1157ipd3. To increase the replicative capacity of SHIV-1157ipd3, an extra NF-κB binding site was engineered into its 3′ long terminal repeat, giving rise to SHIV-1157ipd3N4. This virus was exclusively R5 tropic and replicated more potently in rhesus peripheral blood mononuclear cells than SHIV-1157ipd3 in the presence of tumor necrosis factor alpha. Rhesus macaques of Indian and Chinese origin were next inoculated intrarectally with SHIV-1157ipd3N4; this virus replicated vigorously in both sets of monkeys. We conclude that SHIV-1157ipd3N4 is a highly replication-competent, mucosally transmissible R5 SHIV that represents a valuable tool to test candidate AIDS vaccines targeting HIV-1 clade C Env.