Drosophila Piwi-family proteins have been implicated in transposon control. Here, we examine piwi-interacting RNAs (piRNAs) associated with each Drosophila Piwi protein and find that Piwi and Aubergine bind RNAs that are predominantly antisense to transposons, whereas Ago3 complexes contain predominantly sense piRNAs. As in mammals, the majority of Drosophila piRNAs are derived from discrete genomic loci. These loci comprise mainly defective transposon sequences, and some have previously been identified as master regulators of transposon activity. Our data suggest that heterochromatic piRNA loci interact with potentially active, euchromatic transposons to form an adaptive system for transposon control. Complementary relationships between sense and antisense piRNA populations suggest an amplification loop wherein each piRNA-directed cleavage event generates the 5' end of a new piRNA. Thus, sense piRNAs, formed following cleavage of transposon mRNAs may enhance production of antisense piRNAs, complementary to active elements, by directing cleavage of transcripts from master control loci.