A rapidly evolving understanding of phase separation in the biological and physical sciences has led to the redefining of virus-engineered replication compartments in many viruses with RNA genomes. Condensation of viral, host and genomic and subgenomic RNAs can take place to evade the innate immunity response and to help viral replication. Divergent viruses prompt liquid–liquid phase separation (LLPS) to invade the host cell. During HIV replication there are several steps involving LLPS. In this review, we characterize the ability of individual viral and host partners that assemble into biomolecular condensates (BMCs). Of note, bioinformatic analyses predict models of phase separation in line with several published observations. Importantly, viral BMCs contribute to function in key steps retroviral replication. For example, reverse transcription takes place within nuclear BMCs, called HIV-MLOs while during late replication steps, retroviral nucleocapsid acts as a driver or scaffold to recruit client viral components to aid the assembly of progeny virions. Overall, LLPS during viral infections represents a newly described biological event now appreciated in the virology field, that can also be considered as an alternative pharmacological target to current drug therapies especially when viruses become resistant to antiviral treatment.