Several families of homeobox genes are arranged in genomic clusters in metazoan genomes, including the Hox, ParaHox, NK, Rhox, and Iroquois gene clusters. The selective pressures responsible for maintenance of these gene clusters are poorly understood. The ParaHox gene cluster is evolutionarily conserved between amphioxus and human but is fragmented in teleost fishes. We show that two basal ray-finned fish, Polypterus and Amia, each possess an intact ParaHox cluster; this implies that the selective pressure maintaining clustering was lost after whole-genome duplication in teleosts. Cluster breakup is because of gene loss, not transposition or inversion, and the total number of ParaHox genes is the same in teleosts, human, mouse, and frog. We propose that this homeobox gene cluster is held together in chordates by the existence of interdigitated control regions that could be separated after locus duplication in the teleost fish.