Human endogenous retroviruses (HERVs) and other long terminal repeat (LTR)-containing elements comprise a significant portion (8%) of the human genome and are likely vestiges of retroviral infections during primate evolution. Many of the HERVs present in human DNA have retained functional promoter, enhancer, and polyadenylation signals, and these regulatory sequences have the potential to modify the expression of nearby genes. To identify retroviral elements that contribute to the transcription of human genes, we screened sequence databases for chimeric (viral-cellular) transcripts. These searches revealed a fusion transcript containing the LTR of an HERV-E element linked to the Opitz syndrome gene Mid1. We confirmed the authenticity of the chimeric transcript by 5' rapid amplification of cDNA ends (RACE) and established that the Mid1 mRNA isoform was transcribed from a retroviral LTR. The identification of a retroviral first exon suggested the existence of alternative promoters for Mid1 because nonretroviral (native) 5' untranslated regions (UTRs) had been reported previously for this gene. Although Mid1 transcripts could be detected in all tissues tested, quantitative real-time reverse transcription-polymerase chain reaction indicated that the retroviral promoter contributes significantly to the level of Mid1 transcripts in placenta and embryonic kidney, where chimeric mRNAs were found to represent 25% and 22% of overall Mid1 mRNAs, respectively. Transient transfection studies supported a role for the LTR as a strong tissue-specific promoter in placental and embryonic kidney cell lines and suggested a function for the LTR as an enhancer. These findings provide further evidence that some endogenous retroviruses have evolved a biological function by contributing transcriptional regulatory elements to cellular genes.