A highly repetitive DNA element located 950 bp upstream from a mouse U2 small nuclear RNA gene has been cloned and characterized. The repetitive element is composed of a simple sequence repeat and a cluster of three B1 sequences. Two of these B1 elements are arranged head-to-tail and are joined by an oligo(dA)-rich linker. This unique B1 dimer, comprised of 339 bp, resembles the dimeric structure of primate Alu-family sequences, particularly that of a prototypic human Alu element. The other B1 element within the mouse cluster is a typical monomeric unit. Transcription studies performed in HeLa cell extracts with deletion mutants of the B1 cluster reveal that the single B1 unit is expressed at least 50 times more efficiently than the B1 dimer region. Furthermore, the B1 dimer which contains mutations in the first polymerase III promoter region is not transcribed end-to-end. We conclude that this B1 dimer is unlikely to give rise to a new dimeric retroposon family in the mouse genome.