Dosage compensation is the process by which the expression levels of sex-linked genes are altered in one sex to offset a difference in sex-chromosome number between females and males of a heterogametic species. Degeneration of a sex-limited chromosome to produce heterogamety is a common, perhaps unavoidable, feature of sex-chromosome evolution. Selective pressure to equalize sex-linked gene expression in the two sexes accompanies degeneration, thereby driving the evolution of dosage-compensation mechanisms. Studies of model species indicate that what appear to be very different mechanisms have evolved in different lineages: the male X chromosome is hypertranscribed in drosophilid flies, both hermaphrodite X chromosomes are downregulated in the nematode Caenorhabditis elegans, and one X is inactivated in mammalian females. Moreover, comparative genomic studies demonstrate that the trans-acting factors (proteins and non-coding RNAs) that have been shown to mediate dosage compensation are unrelated among the three lineages. Some tantalizing similarities in the fly and mammalian mechanisms, however, remain to be explained.