Baculovirus can transiently transduce primary human and rat hepatocytes, as well as a subset of stable cell lines. To prolong transgene expression, we have developed new hybrid vectors which associate key elements from adeno-associated virus (AAV) with the elevated transducing capacity of baculovirus. The hybrid vectors contain a transgene cassette composed of the beta-galactosidase (beta-Gal) reporter gene and the hygromycin resistance (Hygr) gene flanked by the AAV inverted terminal repeats (ITRs), which are necessary for AAV replication and integration in the host genome. Constructs were derived both with and without the AAV rep gene under the p5 and p19 promoters cloned in different positions with respect to the baculovirus polyheidrin promoter. A high-titer preparation of baculovirus-AAV (Bac-AAV) chimeric virus containing the ITR-Hygr-beta-Gal sequence was obtained with insect cells only when the rep gene was placed in an antisense orientation to the polyheidrin promoter. Infection of 293 cells with Bac-AAV virus expressing the rep gene results in a 10- to 50-fold increase in the number of Hygr stable cell clones. Additionally, rep expression determined the localization of the transgene cassette in the aavs1 site in approximately 41% of cases as detected by both Southern blotting and fluorescent in situ hybridization analysis. Moreover, site-specific integration of the ITR-flanked DNA was also detected by PCR amplification of the ITR-aavs1 junction in transduced human fibroblasts. These data indicate that Bac-AAV hybrid vectors can allow permanent, nontoxic gene delivery of DNA constructs for ex vivo treatment of primary human cells.