Genetic and environmental factors are believed to influence development of systemic lupus erythematosus (SLE). Endogenous retroviruses (ERV) correspond to the integrated proviral form of infectious retroviruses, which are trapped within the genome due to mutations. ERV represent a key molecular link between the host genome and infectious viral particles. ERV-encoded proteins are recognized by antiviral immune responses and become targets of autoreactivity. Alternatively, ERV protein may influence cellular processes and the life cycle of infectious viruses. As examples, the HRES-1 human ERV encodes a 28-kDa nuclear autoantigen and a 24-kDa small GTP-ase, termed HRES-1/Rab4. HRES-1/p28 is a nuclear autoantigen recognized by cross-reactive antiviral antibodies, while HRES-1/Rab4 regulates surface expression of CD4 and the transferrin receptor (TFR) through endosome recycling. Expression of HRES-1/Rab4 is induced by the tat gene of HIV-1, which in turn down-regulates expression of CD4 and susceptibility to re-infection by HIV-1. CD4 and the TFR play essential roles in formation of the immunological synapse (IS) during normal T-cell activation by a cognate MHC class II peptide complex. The key intracellular transducer of T-cell activation, Lck, is brought to the IS via binding to CD4. T-cell receptorzeta (TCRzeta) chain binds to the TFR. Abnormal T-cell responses in SLE have been associated with reduced lck and TCRzeta chain levels. HRES-1 is centrally located on chromosome 1 at q42 relative to lupus-linked microsatellite markers and polymorphic HRES-1 alleles have been linked to the development of SLE. 1q42 is one of the three most common fragile sites in the human genome, and is inducible by DNA demethylation, a known mechanism of retroviral gene activation. Molecular mimicry and immunomodulation by a ERV, such as HRES-1, may contribute to self-reactivity and abnormal T and B-cell functions in SLE.