We have studied patterns of DNA sequence variation and evolution for 22 genes located on the neo-X and neo-Y chromosomes of Drosophila miranda. As found previously, nucleotide site diversity is greatly reduced on the neo-Y chromosome, with a severely distorted frequency spectrum. There is also an accelerated rate of amino-acid sequence evolution on the neo-Y chromosome. Comparisons of nonsynonymous and silent variation and divergence suggest that amino-acid sequences on the neo-X chromosome are subject to purifying selection, whereas this is much weaker on the neo-Y. The same applies to synonymous variants affecting codon usage. There is also an indication of a recent relaxation of selection on synonymous mutations for genes on other chromosomes. Genes that are weakly expressed on the neo-Y chromosome appear to have a faster rate of accumulation of both nonsynonymous and unpreferred synonymous mutations than genes with high levels of expression, although the rate of accumulation when both types of mutation are pooled is higher for the neo-Y chromosome than for the neo-X chromosome even for highly expressed genes.