We recently reported the 5'-flanking nucleotide sequence of a putative glutamine synthetase (GS) gene from 3T3-L1 cells (Bhandari, B., Beckwith, K. D. & Miller, R. E. (1988) Proc. Natl. Acad. Sci. U.S.A. 85, 5789-5793). We now find that this gene (GSr) has many, but not all, of the characteristics of a typical retroposon. It lacks introns, it contains a short poly(A) tract at its 3' end; it is flanked by 10-base pair (bp) direct repeats; and it corresponds closely at its 5' end to the transcription start site of the intron-containing GS gene (GSi) (Kuo, C. F. & Darnell, J. E., Jr. (1989) J. Mol. Biol. 208, 45-56). GSr includes a full-length, uninterrupted coding sequence that differs little (less than 5%) from that of the intron-containing gene. By contrast, the 5'-flanking sequence of GSr has no similarity with that of GSi. The first 1,029 bp of the GSr 5'-flanking sequence drives expression of a promoterless bacterial chloramphenical acetyltransferase (CAT) gene in transfected HeLa cells at a level comparable to that of the Rous sarcoma virus promoter. Analysis of variably deleted GSrCAT fusions genes in both HeLa and 3T3-L1 cells indicates that full promoter activity of the 1,029-bp sequence requires greater than 348 bp. Moreover, nuclear extract from 3T3-L1 adipocytes as well as murine liver protects four segments in the GSr 5'-flanking sequence from DNase I digestion. Nevertheless, reverse transcription of RNA from 3T3-L1 adipocytes, mouse adipocytes, or mouse liver followed by primer-directed enzymatic amplification of the reverse transcripts reveals the presence of GSi transcripts but the absence of GSr transcripts. Thus, the 5'-flanking sequence of GSr is an active promoter that drives transcription of GSrCAT fusion genes and includes binding domains for proteins that have the potential to regulate transcription. We conclude that the intronless murine GS gene isolated from 3T3-L1 cells arose as a retroposon that was inserted into the genome downstream of a potentially active promoter.