To study the feasibility of a therapy for thalassemia based on addition of a correctly functioning globin gene to bone marrow stem cells, we have developed retroviral vectors that can transfer the human beta-globin gene into pluripotent hematopoietic stem cells of the mouse. Mice reconstituted with virus-infected bone marrow cells showed long-term tissue-specific expression of human beta-globin RNA and protein. Recently, we have redesigned the retroviral vector to improve the efficiency of stem cell infection and to raise the level of globin expression obtained from the virally transduced gene. Removal of a portion of the second intron of the beta-globin gene resulted in the accumulation of a higher level of full-length viral RNA in retrovirus packaging cell lines, and these cell lines produced beta-globin virus particles at substantially higher titers. Addition of fragments from the locus activation region (LAR) of the beta-like globin gene cluster to the retroviral vectors increased beta-globin expression in infected murine erythroleukemia (MEL) cells. Fragments from the -18 and -10.9 kbp DNase I-hypersensitive sites of the LAR increased human beta-globin RNA levels to 35% and 132% of the endogenous mouse beta maj-globin RNA level, respectively. Increased expression was also found for neomycin phosphotransferase RNA, which was transcribed from the retroviral long terminal repeat (LTR), showing that the LAR fragments also activated expression from a nearby heterologous promoter. These results are discussed in the context of the efficacy and safety of gene therapy for chronic anemia in humans.