The historical population genetic processes associated with the divergence of members of the Drosophila virilis species group were examined using DNA sequence variation from two loci. New data on DNA sequence variation from the oskar locus, taken from within and among all five closely related taxa in the virilis phylad of the D. virilis species group, were examined and compared with similar data previously collected from the period locus. Overall, the oskar and period data sets reveal similar patterns of variation. Both loci support the conclusion that the two subspecies of D. americana have had a large historical population size and are exchanging genes in nature. From these data there is little reason to consider them as distinct taxa. In the case of D. novamexicana, from which six lines were sequenced at each locus, there is an intriguing difference in the pattern seen at the two loci. Both loci reveal two distinct groups that are considerably divergent from each other, with very little evidence of gene flow between them. However, the grouping of lines into distinct subgroups based on oskar is different from the grouping based on period. The simplest explanation seems to be that D. novamexicana includes two distinct species, and that the sample of six lines happens to include cases of recent gene exchange. Alternatively, both oskar and period could be linked to sites of strong balancing selection and limited recombination.