The African trypanosome, Trypanosoma brucei, causes sleeping sickness in humans in sub-Saharan Africa. Here we report the sequence and analysis of the 1.1 Mb chromosome I, which encodes approximately 400 predicted genes organised into directional clusters, of which more than 100 are located in the largest cluster of 250 kb. A 160-kb region consists primarily of three gene families of unknown function, one of which contains a hotspot for retroelement insertion. We also identify five novel gene families. Indeed, almost 20% of predicted genes are members of families. In some cases, tandemly arrayed genes are 99-100% identical, suggesting an active process of amplification and gene conversion. One end of the chromosome consists of a putative bloodstream-form variant surface glycoprotein (VSG) gene expression site that appears truncated and degenerate. The other chromosome end carries VSG and expression site-associated genes and pseudogenes over 50 kb of subtelomeric sequence where, unusually, the telomere-proximal VSG gene is oriented away from the telomere. Our analysis includes the cataloguing of minor genetic variations between the chromosome I homologues and an estimate of crossing-over frequency during genetic exchange. Genetic polymorphisms are exceptionally rare in sequences located within and around the strand-switches between several gene clusters.