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First discovered in maize, paramutation is a phenomenon in which one allele can trigger an epigenetic conversion of an alternate allele. This conversion causes a genetically heterozygous individual to transmit alleles that are functionally the same, in apparent violation of Mendelian segregation. Studies over the past several decades have revealed a strong connection between mechanisms of genome defense against transposable elements by small RNA and the phenomenon of paramutation. For example, a system of paramutation in Drosophila melanogaster has been shown to be mediated by piRNAs, whose primary function is to silence transposable elements in the germline. In this paper, we characterize a second system of piRNA-mediated paramutation-like behavior at the telomere of Drosophila virilis. In Drosophila, telomeres are maintained by arrays of retrotransposons that are regulated by piRNAs. As a result, the telomere and sub-telomeric regions of the chromosome have unique regulatory and chromatin properties. Previous studies have shown that maternally deposited piRNAs derived from a sub-telomeric piRNA cluster can silence the sub-telomeric center divider gene of Drosophila virilis in trans. In this paper, we show that this silencing can also be maintained in the absence of the original silencing allele in a subsequent generation. The precise mechanism of this paramutation-like behavior may be explained by either the production of retrotransposon piRNAs that differ across strains or structural differences in the telomere. Altogether, these results show that the capacity for piRNAs to mediate paramutation in trans may depend on the local chromatin environment and proximity to the uniquely structured telomere regulated by piRNAs. This system promises to provide significant insights into the mechanisms of paramutation.