Chromosomal inversions are the most common type of genome rearrangement in the genus Drosophila. Although the potential of transposable elements (TEs) for generating inversions has been repeatedly demonstrated in the laboratory, little is known on their role in the generation of natural inversions, which are those effectively contributing to the adaptation and/or evolution of species. We have cloned and sequenced the two breakpoints of the polymorphic inversion 2q7 of D. buzzatii. The sequence analysis of the breakpoint regions revealed the presence in the inverted chromosomes of large insertions, formed by complex assemblies of transposons, that are absent from the chromosomes without the inversion. Among the transposons inserted, the Foldback-like element Galileo, that was previously found responsible of the generation of the widespread inversion 2j of D. buzzatii, is present at both 2q7 breakpoints and is the most likely inducer of the inversion. A detailed study of the nucleotide and structural variation in the breakpoint regions of six chromosomal lines with the 2q7 inversion detected no nucleotide differences between them, which suggests a monophyletic and recent origin. In contrast, a remarkable degree of structural variation was observed in the same six chromosomal lines. It thus appears that the two breakpoints of the inverted chromosomes have become genetically unstable hotspots, as was previously found for the 2j inversion breakpoints. The possibility that this instability is caused by structural properties of Foldback elements is discussed.