Caprine arthritis encephalitis virus (CAEV) causes caprine arthritis encephalitis syndrome, which is an emerging disease of goats in the Philippines. DNA sequence analysis showed homology of 86-93 % between Philippine CAEV and available CAEV sequences in GenBank. CAEV was detected using nested polymerase chain reaction (PCR), and new sets of primers were designed in order to amplify the gag gene, which is a highly conserved region of the viral genome. In addition, the Philippine CAEV isolate clustered in group B with the prototype caprine lentivirus. Based on amino acid sequence alignments, it is possible that the Philippine CAEV isolate is a new strain of CAEV, but it is also possible that it was already present in the country even before the start of goat importation. Molecular characterization of the CAEV gag gene is important for the development of a detection kit specific for the local strain of CAEV and the establishment of small ruminant lentivirus eradication programs in the Philippines. This study is the first report to describe the molecular characteristics of CAEV circulating in the Philippines.