Transposons can be found in both prokaryotes and eukaryotes, accounting for 5% of amoeba genome, 44% of the human genome and up to 90% of the maize genome. There are many different types of transposons, but they can be broadly characterized into two distinct classes - one, and two. 

Class one transposons, also known as retrotransposons, require transcription of an RNA intermediate into DNA before being inserted into their target. 

However, class two transposons - or “DNA only transposons” - remain in DNA form throughout transposition. They also contain a gene encoding a multifunctional enzyme called transposase. 

The transposase gene is flanked by terminal inverted repeats which are single-stranded, about 9 to 40 base pairs long, and reverse complements of each other. During cut and paste transposition, the gene expresses two monomers of the transposase enzyme, which bind to the terminal inverted repeats. 

When the monomers dimerize, they bring the two inverted repeats together. This creates a stable DNA protein complex called a synaptic complex or a transpososome. 

Next the transpososome cleaves the DNA strands on each end of the transposon leaving behind sequences called direct repeats. This releases the transposon from the donor DNA, and it is now free to be transported to a random target. 

For insertion, the transposase makes two staggered cuts in the target DNA by cleaving the phosphodiester bonds. The cut strands of the target DNA are pulled apart to create a gap with single-stranded overhangs.

Now, the 3’ OH end of the transposon DNA reacts with the 5’ terminal of the target DNA, leaving gaps between the 5’ ends of the transposon and the 3’ ends of the target. 

DNA polymerase uses the 3’ end of the gap as a primer and fills the gap in a process called target site duplication. The newly synthesized DNA and the transposon are joined by DNA ligase.

Such an insertion can have significant possible effects. In some cases, it may turn the target gene on or off by providing novel promoters or insulators encoded by the transposon.

Alternatively, it can also alter the gene function by disrupting normal exon splicing during mRNA generation. For example, this can happen if a transposon containing a new splice site jumps into an existing gene and rewires the transcriptional signals - resulting in the creation of an aberrant mRNA.