A boundary integral formulation is used to investigate the interaction between a pair of deformable drops in a simple shear flow. The interactions do not promote appreciably the breakup of the drops. For certain ratios of the viscosities of the drops and the suspending fluid, the lubrication gap that separates the two drops can diminish rapidly in the extensional quadrant of the flow. Slight deformation endows the drops with an apparent short-range repulsive interaction: drop coalescence requires van der Waals attraction which was not included in this study. From the trajectories of different collisions, the self-diffusion coefficients that describe the cross-flow migration of the non-Brownian drops in a dilute sheared emulsion are obtained. The self-diffusivities are very anisotropic, depend strongly on the viscosity ratio, and depend modestly on the shear rate.