In plants, the genome of the host responds to the amplification of transposable elements (TEs) with DNA methylation. However, neither the factors involved in TE methylation nor the dynamics of the host-TE interaction are well resolved. Here, we identify 5,522 long terminal repeat retrotransposons (LTR-RT) in the genome of Oryza sativa ssp. japonica and then assess methylation for individual elements. Our analyses uncover three strong trends: long LTR-RTs are more highly methylated, the insertion times of LTR-RTs are negatively correlated with methylation, and young LTR-RTs tend to be closer to genes than older insertions. Additionally, a phylogenetic examination of the gypsy-like LTR-RT superfamily revealed that methylation is phylogenetically correlated. Given these observations, we present a model suggesting that the phylogenetic correlation among related LTR-RTs is a primary mechanism driving methylation. In this model, bursts of transposition produce new elements with high sequence similarity. The host machinery identifies proliferating elements as well as closely related LTR-RTs through cross-homology. In addition, our data are consistent with previous hypotheses that methylated LTR-RT elements are removed preferentially from regions near genes, explaining some of the observed age distribution.