Angiotensin-I-converting enzyme (ACE) is involved in the synthesis and degradation of important bioactive peptides. The ACE gene has a 287-bp insertion/deletion polymorphism that controls ACE expression through a mechanism that remains elusive. In this study, we found that the 287-bp polymorphic element of the ACE gene, a member of the AluYa5 sub-family of Alu elements, codes for an RNA molecule that controls the levels of ACE mRNA. Transient transfection of a plasmid containing a CMV promoter upstream of the ACE polymorphic element resulted in significant expression of an AluYa5 RNA and reduced ACE mRNA expression as well as ACE enzymatic activity in AD 293 cells. The AluYa5 element also independently reduced the expression of other genes, regardless of whether these genes harbored Alu elements within their genomic context. Interestingly, the CMV promoter was not required for the expression of the AluYa5 element in AD 293 cells. The 287-bp sequence was sufficient to produce AluYa5 RNA and led to a significant reduction in ACE gene expression. Moreover, the removal of an 11-bp fragment of the 3' end of the ACE polymorphic sequence, which is specific to this particular AluYa5 element, did not prevent this element from being expressed but did affect its ability to target ACE expression. Thus, the expression of the AluYa5 polymorphic element within the ACE gene could explain why patients carrying the ACE insertion polymorphism have reduced risk of developing several chronic diseases.