We have developed a cell-free system for an avian retrovirus that promotes autointegration, one-long-terminal-repeat (LTR) circle formation, and correct integration into exogenous target DNA. In this system, autointegration and one-LTR circle formation occurred far more frequently than integration into exogenous target DNA. Autointegration had the same characteristics of normal integration into target DNA except in its selection of target. Highly efficient autointegration as well as one-LTR circle formation in vitro suggest that there may be a mechanism to prevent these processes in vivo.