The foamy virus (FV) genome contains two promoters, the canonical long terminal repeat (LTR) promoter, containing three consensus AP-1 binding sites, and an internal promoter (IP) within the env gene. We investigated the regulation of the two promoters in lytic and persistent infections and found that in the presence of a constitutive source of the viral transactivator protein Tas, transactivation of the LTR promoter and that of the IP differ. In lytic infections, both the LTR promoter and the IP are efficiently transactivated by Tas, while in persistent infections, the IP is efficiently transactivated by Tas, but the LTR promoter is not. Analysis of proteins expressed from the LTR promoter and the IP during infection indicated that IP transcription is more robust than that of the LTR promoter in persistently infected cells, while the opposite is true for lytically infected cells. Coculture experiments also showed that LTR promoter transcription is greatest in cells which support lytic replication. Replacement of much of the LTR promoter with the IP leads to increased viral replication in persistent but not lytic infections. We also found that the induction of persistently infected cells with phorbol 12-myristate 13-acetate (PMA) greatly enhanced viral replication and transcription from the SFVcpz(hu) (new name for human FV) LTR promoter. However, mutation of three consensus AP-1 binding sites in the FV LTR promoter did not affect viral replication in lytically or persistently infected cells, nor did the same mutations affect LTR promoter transactivation by Tas in PMA-treated cells. Our data indicate that differential regulation of transcription is important in the outcome of FV infection but is unlikely to depend on AP-1.