A long terminal repeat-containing retrotransposon is mobilized during hybrid dysgenesis in Drosophila virilis. A hybrid dysgenesis syndrome similar to those described in Drosophila melanogaster occurs in Drosophila virilis when a laboratory stock is crossed to a wild strain collected in the Batumi region of Georgia (U.S.S.R). Mutations in various loci obtained during these crosses are presumably induced by the insertion of DNA sequences. We have cloned an induced white mutation and characterized the insertion sequence responsible for the mutant phenotype. This sequence is a 10.6-kilobase (kb) transposable element we have named Ulysses. This element is flanked by unusually large 2.1-kb long terminal repeats. Ulysses also contains other landmarks characteristic of the retrotransposon family, such as a tRNA-binding site adjacent to the 5' long terminal repeat and open reading frames encoding putative products with homology to the reverse transcriptase, protease, and integrase domains typical of proteins encoded by vertebrate retroviruses. Some of the mutations obtained do not contain a copy of the Ulysses element at the mutant locus, suggesting that a different transposable element may be responsible for the mutation. Therefore, Ulysses may not be the primary cause of the entire dysgenic syndrome, and its mobilization may be the result of activation by an independent mobile element. 