DNA hypomethylation is assumed to be a feature of the mammalian placenta; however, its role in regulating placental gene expression is not well defined. In this study, MeDIP and Sequenom MassARRAY were used to identify hypomethylated gene promoters in the human placenta. Among the genes identified, the hypomethylation of an alternative promoter for KCNH5 was found to be restricted to the placenta and chorion. Complete methylation of this promoter correlates with a silenced KCNH5 transcript in embryonic tissues, including the amnion. Unusually, this hypomethylated promoter and the alternative first exon are derived from a SINE (AluY) retrotransposon. Examination of additional retrotransposon-derived gene promoters in the placenta confirmed that retrotransposon hypomethylation permits the placenta-specific expression of these genes. Furthermore, the lineage-specific methylation displayed by KCNH5, INSL4, and ERVWE1 revealed that dichotomous methylation establishes differential retrotransposon silencing between the extra-embryonic and embryonic lineages. The hypomethylation of the retrotransposons that regulate these genes, each of which arose during recent primate evolution, is consistent with these genes having functional roles that are unique to the invasive haemochorial placentas of humans and recent primates.