Gammaretroviruses are known to cause leukaemia, lymphoma and immunosuppression in many species and the original isolation of KoRV (koala retrovirus) (Hanger et al 2000) was made as part of a study into the cause of the high rate of leukaemia and lymphoma in koalas. The virus however displayed some unusual features. While classified as an endogenous (inherited) gammaretrovirus it was unusually active. While endogenous viruses are very common with up to 8% of the human genome consisting of retroviral material they are usually mutated and inactive (Gifford and Tristem 2002). KoRV possessed a full length replication competent genome, was actively transcribed and produced viral particles. KoRV was also very closely related to the exogenous (horizontally transmitted) retrovirus of Gibbons (Gibbon ape leukaemia virus or GaLV). Normally closely related viruses are found in closely related species. This unusual similarity between KoRV and GaLV raised the possibility of a recent host species jump (Hanger et al 2000). This thesis makes a case for the recent introduction of KoRV into the koala genome and ongoing endogenisation into the koala genome. KoRV is demonstrated definitively as an endogenous virus but present at a mixed prevalence within the Australian koala population. The thesis also further characterizes KoRVs activity and establishes an association between KoRV and disease in koalas. It is difficult to prove that a virus present in all animals in a population (as is the case for most endogenous viruses) is the cause of a particular disease syndrome. Here real time PCR was used to quantify the level of viraemia and proviral DNA load in the blood of individuals. A significant association between high viral load and leukaemia and lymphoma was demonstrated. This was further confirmed in a follow up study of a group of animals where those with a high viral RNA level were at a greater risk of dying from neoplasia. The real time PCR study also indicated that animals suffering from clinical chlamydiosis had higher viral RNA levels than their healthy counterparts though this was not significant. This disease association was further strengthened when KoRV free populations were identified and were shown to have lower incidences of these diseases. The real time PCR studies demonstrated a considerable variation in the proviral copy number in individual animals. With most endogenous retroviruses the proviral copy number is fixed within the species or population (Boeke and Stoye 1997). Southern blotting was used to confirm this variation in copy number and also demonstrated variation in the pattern of these proviral inserts between unrelated animals. The random insertion pattern of KoRV provirus loci was further confirmed using cytogenetics. Sequencing of the KoRV envelope gene revealed marked variation in sequence within individual animals. These sequences despite considerable mutation in some cases were all potentially functional and indicate positive selection pressure for active virus within the individual animals. Inverse PCR was used to identify the koala genomic sequence interrupted by the proviral loci. While koala genomic sequence was successfully amplified no potential oncogenes were found. This study did however demonstrate the presence of truncated KoRV sequences missing a large part of the gagpro- pol gene. Electron microscopy also demonstrated KoRV viral particles in the bone marrow of a leukaemic animal. KoRV had originally been classified as an endogenous virus based on the fact that it was present in all animals tested and in all tissues of individual animals. However the accepted definition of an endogenous virus is one that is present in the germ line DNA and is inherited over several generations (Boeke and Stoye 1997). Single cell PCR of koala sperm was used to demonstrate that KoRV is present in germ line DNA. This was confirmed using fluorescent in situ hybridization (FISH) techniques. Southern blotting of blood obtained from a group of related captive animals showed the inheritance of proviral loci over several generations. To determine whether all koalas carried KoRV loci, samples from geographically diverse populations were obtained. As expected all animals in Queensland were positive for KoRV using PCR techniques. Unexpectedly animals from Kangaroo Island in South Australia were free of KoRV. Samples obtained from Victorian animals demonstrated a mixed KoRV status. The animals on Kangaroo Island have been isolated from other populations since the 1920s and this raises the possibility that KoRV has integrated into the mainland koala population during the last 100 years. This is unprecedented for an endogenous virus with the most recent estimate for integration in other species being the type C viruses of pigs 5000 years ago (Mang et al 2001). The mixed prevalence of KoRV and its high activity indicate that this virus is still undergoing the process of endogenisation and provides a unique opportunity to study this process in a wild animal population.