Compositions and methods are disclosed for producing adeno-associated virus (AAV) in insect cells in vitro. Recombinant baculovirus vectors include an AAV Capsid gene expression cassette (Cap), an AAV Rep gene expression cassette (Rep), and a baculovirus homologous region (hr) located up to about 4 kb from a start codon in an AAV expression cassette. Production levels of baculovirus and AAV in insect cells harboring recombinant baculovirus comprising a Cap, a Rep, and an hr are higher compared to controls comprising a Cap and a Rep but no hr. Furthermore, levels of baculovirus and AAV production in insect cells infected with recombinant baculovirus comprising a Cap, a Rep, and an hr are comparatively stable over serial passages of cells, whereas levels of baculovirus and AAV production decline over serial passages of insect cells comprising recombinant baculovirus comprising a Cap and a Rep, but no hr.
