Hypermutation of the immunoglobulin (Ig) genes requires Activation Induced cytidine Deaminase (AID) and transcription, but it remains unclear why other transcribed genes of B cells do not mutate. We describe a reporter transgene crippled by hypermutation when inserted into or near the Ig light chain (IgL) locus of the DT40 B cell line yet stably expressed when inserted into other chromosomal positions. Step-wise deletions of the IgL locus revealed that a sequence extending for 9.8 kilobases downstream of the IgL transcription start site confers the hypermutation activity. This sequence, named DIVAC for diversification activator, efficiently activates hypermutation when inserted at non-Ig loci. The results significantly extend previously reported findings on AID-mediated gene diversification. They show by both deletion and insertion analyses that cis-acting sequences predispose neighboring transcription units to hypermutation.