Human trophoblast expresses two fusogenic retroviral envelope proteins, the widely studied syncytin 1, encoded by HERV-W and the recently characterized syncytin 2 encoded by HERV-FRD. Here we studied syncytin 2 in normal and Trisomy 21-affected placenta associated with abnormal trophoblast differentiation. Syncytin 2 immunolocalization was restricted throughout normal pregnancy to some villous cytotrophoblastic cells (CT). During the second trimester of pregnancy, syncytin 2 was immunolocalized in some cuboidal CT in T21 placentas, whereas in normal placentas it was observed in flat CT, extending into their cytoplasmic processes. In vitro, CT isolated from normal placenta fuse and differentiate into syncytiotrophoblast. At the same time, syncytin 2 transcript levels decreased significantly with syncytiotrophoblast formation. In contrast, CT isolated from T21-affected placentas fused and differentiated poorly and no variation in syncytin 2 transcript levels was observed. Syncytin 2 expression illustrates the abnormal trophoblast differentiation observed in placenta of fetal T21-affected pregnancies.