To analyze the methylation status of wild-type adeno-associated virus type 2 (AAV2), bisulfite PCR sequencing (BPS) of the packaged viral genome and its integrated form was performed and 262 of the total 266 CG dinucleotides (CpG) were mapped. In virion-packaged DNA, the ratio of the methylated cytosines ranged between 0–1.7%. In contrast, the chromosomally integrated AAV2 genome was hypermethylated with an average of 76% methylation per CpG site. The methylation level showed local minimums around the four known AAV2 promoters. To study the effect of methylation on viral rescue and replication, the replication initiation capability of CpG methylated and non-CpG methylated AAV DNA was compared. The in vitro hypermethylation of the viral genome does not inhibit its rescue and replication from a plasmid transfected into cells. This insensitivity of the viral replicative machinery to methylation may permit the rescue of the integrated heavily methylated AAV genome from the host’s chromosomes.