The interferon-inducible cellular protein tetherin (CD317/BST-2) inhibits the release of a broad range of enveloped viruses. The HIV-1 accessory protein Vpu enhances virus particle release by counteracting this host restriction factor. While the antagonism of human tetherin by Vpu has been associated with both proteasomal and lysosomal degradation, the link between Vpu-mediated tetherin degradation and the ability of Vpu to counteract the antiviral activity of tetherin remains poorly understood. Here, we show that human tetherin is expressed at low levels in African green monkey kidney (COS) cells. However, Vpu markedly increases tetherin expression in this cell line, apparently by sequestering it in an internal compartment that bears lysosomal markers. This stabilization of tetherin by Vpu requires the transmembrane sequence of human tetherin. Although Vpu stabilizes human tetherin in COS cells, it still counteracts the ability of tetherin to suppress virus release. The enhancement of virus release by Vpu in COS cells is associated with a modest reduction in cell-surface tetherin expression, even though the overall expression of tetherin is higher in the presence of Vpu. This study demonstrates that COS cells provide a model system in which Vpu-mediated enhancement of HIV-1 release is uncoupled from Vpu-mediated tetherin degradation.