I elements in Drosophila melanogaster are non-long terminal repeat (LTR) retrotransposons of particular interest because high levels of transposition can be induced by appropriate crosses. They use a full-length RNA transposition intermediate as a template for reverse transcription. Detailed molecular characterization of this intermediate is rendered difficult because of the many transcripts produced by defective elements. The use of an active I element marked with a sequence encoding the HA epitope solves this problem. We used an RNA circularization procedure followed by RT-PCR to analyze the transcripts produced by actively transposing tagged I elements. Most start at the 5' end at the second nucleotide of the I element and all are polyadenylated at a site located in genomic sequences downstream of the 3' end. One of the tagged I elements, inserted in locus 88A, produces chimeric transcripts that carry sequences from both 5'- and 3'-flanking genomic DNA. We show that synthesis of these chimeric transcripts is controlled by the I element itself. Analysis of full-length transposed copies of this element shows that the extra sequences at the 5' and 3' ends are not integrated during retrotransposition. This suggests that initiation and arrest of reverse transcription during retrotransposition are precise processes.