Friedreich's ataxia (FRDA) is caused by large GAA expansions in intron 1 of the frataxin gene (FXN), which lead to reduced FXN expression through a mechanism not fully understood. Understanding such mechanism is essential for the identification of novel therapies for FRDA and this can be accelerated by the development of cell models which recapitulate the genomic context of the FXN locus and allow direct comparison of normal and expanded FXN loci with rapid detection of frataxin levels. Here we describe the development of the first GAA-expanded FXN genomic DNA reporter model of FRDA. We modified BAC vectors carrying the whole FXN genomic DNA locus by inserting the luciferase gene in exon 5a of the FXN gene (pBAC-FXN-Luc) and replacing the six GAA repeats present in the vector with an ∼310 GAA repeat expansion (pBAC-FXN-GAA-Luc). We generated human clonal cell lines carrying the two vectors using site-specific integration to allow direct comparison of normal and expanded FXN loci. We demonstrate that the presence of expanded GAA repeats recapitulates the epigenetic modifications and repression of gene expression seen in FRDA. We applied the GAA-expanded reporter model to the screening of a library of novel small molecules and identified one molecule which up-regulates FXN expression in FRDA patient primary cells and restores normal histone acetylation around the GAA repeats. These results suggest the potential use of genomic reporter cell models for the study of FRDA and the identification of novel therapies, combining physiologically relevant expression with the advantages of quantitative reporter gene expression.