The activation of H-plk (Human-proviral linked Krüppel), a human Krüppel-related zinc finger gene in organs such as placenta, adrenal cortex, and testis, is probably due to insertion of an endogenous retrovirus, ERV3, upstream of the gene. Several differently spliced transcripts originate from this locus, e.g., a transcript encoding the retroviral envelope protein and a few differentially spliced transcripts encoding both the env and the zinc finger protein. During a screening for zinc finger proteins expressed during monocyte differentiation, two H-plk encoding cDNA clones were isolated from the human monoblast cell line U-937. Northern blot analysis of a panel of human hematopoietic cell lines showed high levels of constitutive expression of this zinc finger transcript in two monocytic cell lines (U-937 and THP-1) but not in any of the other cell lines or tissues tested. In addition, the H-plk transcript was upregulated by the phorbolester PMA in U-937 and in an additional monocytic cell line, MonoMac 6. Genomic Southern blot analysis of a panel of hematopoietic cell lines, after cleavage with the methylation sensitive enzyme Xho I, led to the detection of tissue specific demethylation in all three monocytic cell lines. The Xho I site was mapped to a position just downstream of the regulatory region of the endogenous retrovirus. By analysis of the U-937 cell line with two additional restriction enzymes, Nar I and Sma I, the demethylation was shown to affect at least three independent CpG dinucleotides in this region of the gene. In summary, the present data provide evidence for specific demethylation of this genomic region, in cells of monocytic origin, resulting in enhanced transcription of the genetic regions derived from both the env region of the retrovirus and the Krüppel-related zinc finger gene.