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Genes on the sex chromosomes are unique because of their sex-specific inheritance. One question is whether homologous gene pairs on the sex chromosomes, which have diverged in their sequence, have acquired different functions. We have analyzed the first homologous pair of genes (CHD1Z and CHD1W) discovered on the avian Z and W sex chromosomes of the zebra finch (Taeniopygia guttata) to examine whether functional differences may have evolved. Sequence analysis revealed that the two genes maintained a high degree of similarity especially within the C, H, and D domains, but outside of these regions larger differences were observed. Expression studies showed that CHD1W was unique to females and has the potential to produce a protein that CHD1Z does not. CHD1Z mRNA was expressed at a higher level in the male brain than in the female brain at various post-hatch ages. Reporter constructs containing the 5′ flanking regions of each gene showed they had the ability to drive reporter expression in primary cell cultures. The 5′ flanking region sequence of CHD1Z and CHD1W exhibited little homology, and differences in putative promoter elements were apparent. These differences between CHD1Z and CHD1W suggest that the two proteins may have diverged in their function.