Inappropriate or chronic detection of self nucleic acids by the innate immune system underlies many human autoimmune diseases. We discuss here an unexpected source of endogenous immunostimulatory nucleic acids: the reverse-transcribed cDNA of endogenous retroelements. The interplay between innate immune sensing and clearance of retroelement cDNA has important implications for the understanding of immune responses to infectious retroviruses such as human immunodeficiency virus (HIV). Furthermore, the detection of cDNA by the innate immune system reveals an evolutionary tradeoff: selection for a vigorous, sensitive response to infectious retroviruses may predispose the inappropriate detection of endogenous retroelements. We propose that this tradeoff has placed unique constraints on the sensitivity of the DNA-activated antiviral response, with implications for the interactions of DNA viruses and retroviruses with their hosts. Finally, we discuss how better understanding of the intersection of retroelement biology and innate immunity can guide the way to novel therapies for specific autoimmune diseases.