Transgenic tobacco plants expressing either a full-length form of the tobacco etch virus (TEV) coat protein or a form truncated at the N terminus of the TEV coat protein were initially susceptible to TEV infection, and typlcal systemic symptoms developed. However, 3 to 5 weeks after a TEV infection was established, transgenlc plants "recovered" from the TEV infection, and new stem and leaf tissue emerged symptom and virus free. A TEV-resistant state was induced ln the recovered tissue. The resistance was virus speclflc. Recovered plant tissue could not be lnfected wlth TEV, but was susceptlble to the closely related virus, potato virus Y. The resistance phenotype was functional at the slngle-cell leve1 because protoplasts from recovered transgenic tissue did not support TEV repllcation. Surprlslngly, steady state transgene mRNA levels in recovered tissue were 12-to 22-fold less than transgene mRNA levels in uninoculated transgenic tissue of the same developmental stage. However, nuclear run-off studles suggested that transgene transcription rates in recovered and uninoculated plants were similar. We propose that the resistant state and reduced steady state levels of transgene transcript accumulation are mediated at the cellular leve1 by a cytoplasmic actlvity that targets speclfic RNA sequences for inactlvation.