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Long interspersed element 1 (L1) retrotransposons are implicated in human disease and evolution. Their global activity is repressed by DNA methylation, but deciphering the regulation of individual copies has been challenging. Here, we combine short- and long-read sequencing to unveil L1 methylation heterogeneity across cell types, families, and individual loci and elucidate key principles involved. We find that the youngest primate L1 families are specifically hypomethylated in pluripotent stem cells and the placenta but not in most tumors. Locally, intronic L1 methylation is intimately associated with gene transcription. Conversely, the L1 methylation state can propagate to the proximal region up to 300 bp. This phenomenon is accompanied by the binding of specific transcription factors, which drive the expression of L1 and chimeric transcripts. Finally, L1 hypomethylation alone is typically insufficient to trigger L1 expression due to redundant silencing pathways. Our results illuminate the epigenetic and transcriptional interplay between retrotransposons and their host genome., Competing Interests: Declaration of interests G.C. is an unpaid associate editor of the journal Mobile DNA (Springer-Nature)., (Copyright © 2024 The Authors. Published by Elsevier Inc. All rights reserved.)