Mouse mammary tumor virus proviral DNA is endogenous to most inbred strains of mice but in many strains is not transcriptionally active. This inactivity may be due to defects in the proviruses themselves or to position effects mediated by DNA sequences flanking the proviral units. The transcriptional competence of long terminal repeats (LTRs) derived from endogenous proviral DNA at genetic loci Mtv-8, Mtv-9, and Mtv-17 of the C57BL/6 mouse strain was examined with a transient transfection assay in which gene expression was monitored by expression of chloramphenicol acetyltransferase. LTRs from Mtv-8 and Mtv-9 were able to direct glucocorticoid-induced chloramphenicol acetyltransferase expression in this assay, while the LTR from Mtv-17 was only about 5% as effective. Analysis of chimeric LTRs indicated that the glucocorticoid-inducible transcriptional enhancer element within the Mtv-17 LTR is active when linked to a functional promoter from Mtv-8, whereas the promoter from Mtv-17 is defective in directing hormone-induced gene expression, even when linked to the Mtv-8 glucocorticoid-responsive enhancer. The DNA sequence of transcriptional control regions of the LTRs of all three endogenous proviral units was determined; this analysis revealed that the source of the defect in Mtv-17 is a single G-to-A transition at position-75 with respect to the site of transcription initiation that resides within the previously defined binding site for the transcription factor nuclear factor 1. Competition experiments with a gel electrophoresis mobility shift assay indicated that the affinity of nuclear factor 1 for DNA derived from Mtv-17 is significantly less than for comparable sequences derived from Mtv-8.