The comparison of fully sequenced genomes enables the study of selective constraints that determine genome organisation. We show that, in fungi, adjacent divergently transcribed (<---->) genes are more conserved in orientation than convergent (--><--) or co-oriented (-->-->) gene pairs. Furthermore, the time divergent orientation of two genes is conserved correlates with the degree of their co-expression and with the likelihood of them being functionally related. The functional interactions of the proteins encoded by the conserved divergent gene pairs indicate a potential for protein function prediction in eukaryotes.