Growing evidence indicates that transposable elements (TEs) play important roles in evolution by providing genomes with coding and non-coding functional sequences. Identification of TE-derived inserts, however, has relied on annotating TEs in individual species, which is adequate for relatively intact TE sequences but likely to those derived from evolutionarily old TEs due to genetic drift beyond recognition. Here, we report a novel approach to uncover previously unannotated degenerate TEs (degTEs) by probing multiple ancestral genomes reconstructed from hundreds of species. We applied this method to the human genome and discovered 1,452,810 degTEs, representing a 10.8% increase over the most recent human TE coverage. Further, we discovered that degTEs contribute to various cis-regulatory elements as well as transcription factor binding sites, including those of a known TE-controlling family, the KRAB zinc-finger proteins. We also report unannotated chimeric transcripts between degTEs and human genes expressed in embryos. This study provides a novel methodology and a freely available resource that will facilitate the investigation of TE co-option events on a full scale.