ABSTRACT: BACKGROUND: The physical organization and chromosomal localization of genes within genomes is known to play an important role in their function. Most genes arise by duplication and move along the genome by random shuffling of DNA segments. Higher order structuring of the genome occurs in eukaryotes, where groups of physically linked genes are co-expressed. However, the contribution of gene duplication to gene order has been not analyzed in detail, as it is believed that co-expression due to recent duplicates would obscure other domains of co-expression. RESULTS: We have catalogued ordered duplicated genes in Drosophila melanogaster, and found that one in five of all genes are organized as tandem arrays. Furthermore, among arrays that have been spatially conserved over longer periods than would be expected on the basis of random shuffling, a disproportionate number contain genes encoding developmental regulators. Using in-situ gene expression data for more than half of the Drosophila genome, we find that genes in these conserved clusters are co-expressed to a much higher extent than other duplicated genes. CONCLUSIONS: These results reveal the existence of functional constraints in insects that retain copies of genes encoding developmental and regulatory proteins as neighbours, allowing their co-expression. This co-expression may be the result of shared cis regulatory elements or a shared need for a specific chromatin structure. Our results highlight the association between genome architecture and the gene regulatory networks involved in the construction of the body plan.