Nonsense-mediated decay constrains transposable element-driven evolutionary innovation

Nonsense-mediated decay (NMD) degrades transcripts carrying premature termination codons, but its role in controlling transposable element-derived transcript diversity is unclear. We assembled an NMD-extended transcriptome (~217,000 transcripts, ~80% unannotated) from long-read RNA sequencing of cell lines after NMD inhibition. NMD-regulated transcripts were enriched in TE exonization, particularly of long terminal repeat (LTR) and long interspersed nuclear element (LINE) integrations, largely as alternative isoforms of annotated genes. Comparative genomics showed that NMD-silenced TEs were evolutionarily younger, more diverged, contained younger, less conserved splice sites, and more often encoded functionally distinct protein isoforms compared to TEs tuned by NMD or in stably expressed transcripts. NMD activity was elevated in lung cancer and associated with improved survival in lung squamous cell carcinoma. We further show that NMD-regulated primate-specific Alu-exonizing isoforms of DDX49, NEIL3 and SETDB1 produced stable proteins with distinct biological activity effects. NMD, thus, buffers TE-driven transcriptomic innovation, controlling the reservoir of evolutionary novelty.