This report identifies a large number of gene-pairs in Drosophila melanogaster that share a common upstream region. 877 gene-pairs (approximately 12% of the genome) are separated by less than 350 bp in a head-to-head orientation. This positional relationship is more highly favored in flies than in other organisms. These gene pairs have a higher correlation of expression than similarly spaced genes that have head-to-tail or tail-to-tail orientations. Thus, the positional arrangement of genes appears to play a significant role in coordinating relative expression patterns and may provide clues for identifying the functions of unknown genes.