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Chronic immune activation that persists despite anti-retroviral therapy (ART) is the strongest predictor of disease progression in HIV infection. Monocyte/macrophages in HIV-infected individuals are known to spontaneously secrete cytokines, although neither the mechanism nor the molecules involved are known. Here we show that overexpression of the newly described co-stimulatory molecule, PD1 homologue (PD-1H) in human monocyte/macrophages is sufficient to induce spontaneous secretion of multiple cytokines. The process requires signaling via PD-1H as cytokine secretion could be abrogated by deletion of the cytoplasmic domain. Such overexpression of PD-1H, associated with spontaneous cytokine expression is seen in monocytes from chronically HIV-infected individuals and this correlates with immune activation and CD4 depletion, but not viral load. Moreover, antigen presentation by PD-1H-overexpressing monocytes results in enhanced cytokine secretion by HIV-specific T cells. These results suggest that PD-1H might play a crucial role in modulating immune activation and immune response in HIV infection.