The nucleocapsid (NC) is an N-terminal protein derived from the HIV-1 Gag precursor polyprotein, pr55^Gag. NC possesses key functions at several pivotal stages of viral replication. For example, an interaction between NC and the host double-stranded RNA-binding protein Staufen1 was shown to regulate several steps in the viral replication cycle, such as Gag multimerization and genomic RNA encapsidation. In this work, we observed that the overexpression of NC leads to the induction of stress granule (SG) assembly. NC-mediated SG assembly was unique as it was resistant to the SG blockade imposed by the HIV-1 capsid (CA), as shown in earlier work. NC also reduced host cell mRNA translation, as judged by a puromycylation assay of de novo synthesized proteins, and this was recapitulated in polysome profile analyses. Virus production was also found to be significantly reduced. Finally, Staufen1 expression completely rescued the blockade to NC-mediated SG assembly, global mRNA translation as well as virus production. NC expression also resulted in the phosphorylation of protein kinase R (PKR) and eIF2α, and this was inhibited with Staufen1 coexpression. This work sheds light on an unexpected function of NC in host cell translation. A comprehensive understanding of the molecular mechanisms by which a fine balance of the HIV-1 structural proteins NC and CA act in concert with host proteins such as Staufen1 to modulate the host stress response will aid in the development of new antiviral therapeutics.