KRAB Zinc Finger Proteins (KZFPs) are a large mammalian transcription factor family, which has mainly been studied for its ability to silence and tame transposable elements (TEs) - a controlling effect brought by the ubiquitous KZFP protein partner, TRIM28. However, the persistence of the old KZFPs in extant genomes, long after their associated TEs have degenerated, challenges this simplistic view. Our study investigates how ancient KZFP-TE interplays are maintained in genomes beyond the canonical arms race model. Through extensive data mining of the ENCODE repository encompassing 82 tissues and 6 widely-assessed epigenetic marks, we described different behaviors of TE subfamilies, depending on the KZFP binding and tissue-specific chromatin states. We focused on LINE/L2s and SINE/MIRs, ancient subfamilies of TEs that are devoid of a canonical repressed state across a variety of tissues. These degenerated TEs are rather characterized by widespread promoter- and enhancer-like signatures. However, the remnants of those TE integrants still display a strong affinity for KZFP binding. Among the LINE/L2 and SINE/MIR binders, we identify ZNF436 as an old and evolutionary conserved KZFP. ZNF436 is highly expressed during heart development and ZNF436-bound LINE/L2s and SINE/MIRs are found in the vicinity of genes necessary for cardiovascular development. Depleting ZNF436 in the model of in vitro cardiomyocyte differentiation led to a lower transcriptional output of many genes required for the proper assembly of sarcomeres in cardiomyocytes, resulting in impaired cardiomyocyte contractility. The positive effect of the presence of ZNF436 in cardiomyocytes on the sarcomeric gene expression was linked to its variant KRAB domain, devoid of TRIM28 interaction. By performing a cardiomyocyte-specific proximity-biotinylation assay we showed that ZNF436 interacts with components of the chromatin remodeling and RNA polymerase II complexes, through its variant KRAB domain. Furthermore, analysis of chromatin accessibility (ATAC-seq) during cardiomyocyte differentiation showed that ZNF436 partakes in regulating the accessibility of TE-derived regulatory regions. Overall, this study provides a functional description of how ancestral TEs are repurposed as regulatory elements in gene regulatory networks and that KZFPs contribute to this evolutionary process. This study is an example of the domestication model describing the intimate co-evolution of TEs and the host genome.