Here we studied one special type of gene, i.e., the nested gene, in the human genome. We collected 373 reliably annotated nested genes. Two-thirds of them were on the strand opposite that of their host gene. About 58% coding nested gene pairs were conserved in mouse and some were even maintained in chicken and fish, while nested pseudogenes were poorly conserved. Ka/Ks analysis revealed that nested genes were under strong selection, although they did not demonstrate greater conservation than other genes. With microarray data we observed that two partners of one nested pair seemed to be expressed reciprocally. A significant proportion of nested genes were tissue-specifically expressed. Gene ontology analysis demonstrated that quite a number of nested genes participated in cellular signal transduction. Based on these observations, we think that nested genes are a group of genes with important physiological functions.