Transgenic pigs have been engineered to express human CD59 (hCD59) in order to suppress hyperacute rejection of xenotransplants in human recipients. In this study, porcine endogenous retrovirus (PERV) was produced in a porcine cell line expressing hCD59 in order to examine the effect of this complement control protein on PERV neutralization by human sera. hCD59 was found to be incorporated into PERV particles produced from engineered ST-IOWA cells. PERV incorporation of hCD59 resulted in a dramatic inhibition of complement-mediated virolysis by human serum. However, incorporation of hCD59 had no effect on neutralization of PERV by human serum, as measured in infectivity assays. Our results suggest that the use of organs from hCD59 transgenic pigs will inhibit complement-mediated virolysis, but will not compromise the protective effects of human sera on the neutralization of PERV particles.