HIV-1 Env mediates fusion of viral and target cell membranes, but it can also mediate fusion of infected (producer) and target cells, thus triggering the formation of multinucleated cells, so-called syncytia. Large, round, immobile syncytia are readily observable in cultures of HIV-1-infected T cells, but these fast growing “fusion sinks” are largely regarded as cell culture artifacts. In contrast, small HIV-1-induced syncytia were seen in the paracortex of peripheral lymph nodes and other secondary lymphoid tissue of HIV-1-positive individuals. Further, recent intravital imaging of lymph nodes in humanized mice early after their infection with HIV-1 demonstrated that a significant fraction of infected cells were highly mobile, small syncytia, suggesting that these entities contribute to virus dissemination. Here, we report that the formation of small, migratory syncytia, for which we provide further quantification in humanized mice, can be recapitulated in vitro if HIV-1-infected T cells are placed into 3D extracellular matrix (ECM) hydrogels rather than being kept in traditional suspension culture systems. Intriguingly, live-cell imaging in hydrogels revealed that these syncytia, similar to individual infected cells, can transiently interact with uninfected cells, leading to rapid virus transfer without cell-cell fusion. Infected cells were also observed to deposit large amounts of viral particles into the extracellular space. Altogether, these observations suggest the need to further evaluate the biological significance of small, T cell-based syncytia and to consider the possibility that these entities do indeed contribute to virus spread and pathogenesis.