The potential of porcine endogenous retrovirus (PERV) as a human pathogen, particularly as a public health risk, is a major concern for xenotransplantation. In vitroPERV transmission to human cells is well established. Evidence from human/pig hematopoietic chimeras in immunodeficient mice suggests PERV transmission from pig to human cells in vivo. However, recently Yang et al. demonstrated in such a model that PERV-C, a nonhuman-tropic class, could be transmitted via pseudotyping by xenotropic murine leukemia virus (X-MLV). We developed a mouse pig islet xenotransplant model, where pig and human cells are located in physically separate compartments, to directly assess PERV transmission from a functional pig xenograft. X-MLV efficiently pseudotypes all three classes of PERV, including PERV-A and -B that are known to productively infect human cell lines and PERV-C that is normally not infectious for human cells. Pseudotyping also extends PERV's natural tropism to nonpermissive, nonhuman primate cells. X-MLV is activated locally by the surgical procedure involved in the tissue transplants. Thus, the presence and activation of endogenous X-MLV in immunodeficient mice limits the clinical significance of previous reports of in vivo PERV transmission from pig tissues to human cells.