A 1.6 kb repetitive DNA sequence (RPS) from Petunia hybrida was identified that destabilizes expression of a GUS marker transgene. Following polyethylene glycol (PEG)-mediated tobacco and petunia protoplast transformations, GUS expression patterns analysed on callus and plant levels were clearly more variable when constructs contained the RPS sequence. The effect on transgene expression required chromosomal integration since the two different RPS constructs employed did not exhibit reduced levels of GUS activities in transient assays. DNA methylation analysis implies a hypermethylated default state of endogenous RPS copies present in the petunia genome. Analysis of the transgene DNA in different transgenic tobacco plants showed almost complete hypermethylation of a particular Hhal site of the RPS sequence. It is proposed that, due to the presence of specific signals within the RPS region or based on interaction of RPS with other endogenous homologous sequences, RPS functions as an initiation region for de novo methylation and induces expression variegation in adjacent sequences.