We have introduced sequences encoding the lac repressor of Escherichia coli into the genome of the mouse. One sequence was derived from the bacterial lac operon and the other was created by reencoding the amino acid sequence of lacI with mammalian codons. Both versions are driven by an identical promoter fragment derived from the human β-actin locus and were microinjected into genetically identical pronuclear stage embryos. All transgenes utilizing the bacterial coding sequence were transcriptionally silent in all somatic tissues tested. The sequence re-encoded with mammalian codons was transcriptionally active at all transgene loci and expressed ubiquitously. Using methylation-sensitive enzymes, we have determined the methylation status of lac repressor transgenes encoded by either the bacterial or mammalian sequence. The highly divergent bacterial sequence was hypermethylated at all transgene loci, while the mammalian sequence was only hypermethylated at a high copy number locus. This may reflect a normal process that protects the genome from acquiring new material that has an abnormally divergent sequence or structure.