show Abstracthide AbstractMultiply-inverted balancer chromosomes that suppress exchange with their homologs are an essential part of the genetic toolkit in Drosophila melanogaster. Despite their widespread use, the breakpoints of the inversions that are crucial for balancer chromosome function have not been identified at the molecular level, and the degree of sequence variation among balancer chromosomes is unknown. To map inversion breakpoints and study potential sequence diversity in the descendants of a structurally-identical balancer chromosome, we sequenced a panel of laboratory stocks containing the most widely used D. melanogaster X-chromosome balancer, First Multiple 7 (FM7). We mapped the locations of FM7 breakpoints to precise euchromatic coordinates and identified the flanking sequence of breakpoints in heterochromatic regions. Analysis of SNP variation revealed megabase-scale blocks of sequence divergence among currently used FM7 stocks. We present evidence that this divergence arose by rare double-recombination events that replaced a female-sterile mutation on FM7 with sequence from balanced chromosomes. Finally, we characterize the Bar mutant that is carried on FM7, and validate the hypothesis that the origin and subsequent reversion of the B1 duplication is mediated by unequal crossing over. Our results reject a simple non-recombining, clonal mode for the laboratory evolution of balancer chromosomes and have implications for how balancer chromosomes should be used in the design and interpretation of genetic experiments in Drosophila.