- Transposable elements (TEs) represent approximately 45% of the human genome and 50-90% of some grass genomes. While most elements contain inactivating mutations, others are reversibly inactivated (silenced) by epigenetic mechanisms, including cytosine methylation. Previous studies have shown that retrotransposons can influence the expression of adjacent host genes. In this study, the methylation patterns of TEs and their flanking sequences in different tissues were undertaken using a novel technique called transposon methylation display (TMD). TMD was successfully applied on a highly copied (approximately 1000 copies), newly amplified LTR retrotransposon family in rice called Dasheng. We determined that the methylation status of a subset of LTRs varies in leaves vs. roots. In addition, we determined that tissue-specific LTR methylation correlated with tissue-specific expression of the flanking rice gene. Genes showing tissue-specific expression were in opposite orientation relative to the LTR. Antisense transcripts were detected in the tissue where the sense transcripts from that gene were not detected. Comparative analysis of Dasheng LTR methylation in the two subspecies, japonica vs. indica revealed LTR-mediated differences in subspecies gene expression. Subspecies-specific expression was due either to polymorphic Dasheng insertion sites between the two subspecies or to subspecies-specific methylation of LTRs at the same locus accounted for observed differences in the expression of adjacent genes.