Human T-cell leukemia virus type 1 (HTLV-1) causes adult T-cell leukemia-lymphoma (ATL) and inflammatory diseases. To enhance cell-to-cell transmission of HTLV-1, the virus increases the number of infected cells in vivo. HTLV-1 bZIP factor (HBZ) is constitutively expressed in HTLV-1 infected cells and ATL cells and promotes T-cell proliferation. However, the detailed mechanism by which it does so remains unknown. Here, we show that HBZ enhances the proliferation of expressing T cells after stimulation via the T-cell receptor. HBZ promotes this proliferation by influencing the expression and function of multiple co-inhibitory receptors. HBZ suppresses the expression of BTLA and LAIR-1 in HBZ expressing T cells and ATL cells. Expression of T cell immunoglobulin and ITIM domain (TIGIT) and Programmed cell death 1 (PD-1) was enhanced, but their suppressive effect on T-cell proliferation was functionally impaired. HBZ inhibits the co-localization of SHP-2 and PD-1 in T cells, thereby leading to impaired inhibition of T-cell proliferation and suppressed dephosphorylation of ZAP-70 and CD3ζ. HBZ does this by interacting with THEMIS, which associates with Grb2 and SHP-2. Thus, HBZ interacts with the SHP containing complex, impedes the suppressive signal from PD-1 and TIGIT, and enhances the proliferation of T cells. Although HBZ was present in both the nucleus and the cytoplasm of T cells, HBZ was localized largely in the nucleus by suppressed expression of THEMIS by shRNA. This indicates that THEMIS is responsible for cytoplasmic localization of HBZ in T cells. Since THEMIS is expressed only in T-lineage cells, HBZ mediated inhibition of the suppressive effects of co-inhibitory receptors accounts for how HTLV-1 induces proliferation only of T cells in vivo. This study reveals that HBZ targets co-inhibitory receptors to cause the proliferation of infected cells.