The patterns of methylation of integrated polyomavirus (Py) DNA and flanking cellular sequences were determined in an inducible line of Py-transformed rat cells, designated LPT, by an analysis of cleavage patterns of LPT DNA generated by the restriction enzymes MspI, HpaII, and HhaI. The Py DNA in LPT cells is integrated into a single chromosomal site and includes whole viral genomes arranged in a head-to-tail configuration. Amplification of the viral DNA and synthesis of infectious virus can be induced in these cells by treatment with carcinogens. The experiments reported here show that in uninduced LPT cells only the late Py genes, which encode the Py capsid proteins, and sequences flanking one of the two viral DNA-cell DNA junctions are methylated. The early genes, encoding the Py T antigens, and sequences flanking the second junction are unmethylated. Since only the early genes are transcribed and translated in uninduced LPT cells, it is apparent that an inverse correlation exists between transcription and methylation of the integrated Py genes in LPT cells, as reported in other cellular and viral systems. The patterns of methylation of integrated Py genomes were also examined in cells of a subclonal derivative of the LPT line in which the virus cannot be activated. In these cells, not only the late Py genes were found to be methylated, but also the 3' portion of the early gene which encodes the Py large T antigen. These findings may have implications for understanding Py induction in LPT cells.