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It has been demonstrated recently that certain repetitive sequences and even expressed single-copy genes are capable of retrotransposition, but little is known about the endogenous or exogenous modifiers of this process in human cells. Retrotransposition may contribute to gene inactivation and genetic instability in cancer development. We have used the human cell line MCF-7 to generate a method for investigating de novo retrotransposition in breast cancer cells. The strategy employs a reporter construct transfected into MCF-7 cells that encodes neomycin phosphotransferase gene (neoR) sequences interrupted by an intron derived from the gamma-globin gene and sandwiched between two promoters in opposite orientation; the phosphotransferase is not produced in transfected cells expressing the plasmid until transposition via a spliced antisense neoR RNA intermediate has occurred, conferring a functional gene product and thereby resistance to G418. A stable transfectant line that showed presence of reporter plasmid DNA and expression of reporter antisense neoR was obtained and used to demonstrate spontaneous retrotransposition of neoR sequences: tester cells were subjected to selection in G418 medium, and neomycin-resistant clones were isolated at a frequency of 10-7. A simple PCR-based prescreening of colonies fixed and stained in Petri dishes can be used to verify intronless neoR DNA. Expanded populations of G418-resistant colonies were determined to be derived from reporter sequences that had transposed via an RNA intermediate by Southern blot genotyping. This experimental assay may be used for exploring endogenous and environmental factors that influence host cell-mediated retrotransposition of unbiased cellular sequences in breast tumor cells. Genes Chromosomes Cancer 26:84–91, 1999. © 1999 Wiley-Liss, Inc.