Transposable element (TE)-derived sequences comprise half of the human genome and DNA methylome and are presumed to be densely methylated and inactive. Examination of genome-wide DNA methylation status within 928 TE subfamilies in human embryonic and adult tissues identified unexpected tissue-specific and subfamily-specific hypomethylation signatures. Genes proximal to tissue-specific hypomethylated TE sequences were enriched for functions important for the relevant tissue type, and their expression correlated strongly with hypomethylation within the TEs. When hypomethylated, these TE sequences gained tissue-specific enhancer marks, including monomethylation of histone H3 at lysine 4 (H3K4me1) and occupancy by p300, and a majority exhibited enhancer activity in reporter gene assays. Many such TEs also harbored binding sites for transcription factors that are important for tissue-specific functions and showed evidence of evolutionary selection. These data suggest that sequences derived from TEs may be responsible for wiring tissue type-specific regulatory networks and may have acquired tissue-specific epigenetic regulation.