Certain mutant alleles of the ovarian tumor (otu) locus give rise to polytene chromosomes in the pseudonurse cells (PNCs). We have previously shown that the banding pattern of these germ line-derived chromosomes is similar to that in the larval salivary gland chromosomes. In this study, we have examined the gene activity of these chromosomes. General gene expression from these chromosomes was studied by uridine autoradiography. The expression of specific genes was monitored by in situ hybridisation to mRNA and also by combining enhancer trap lines with otu mutants. We found that most of the genes studied were expressed in the PNCs as they were in the wild-type nurse cells. Four out of the 12 mRNAs studied accumulated in the nuclei instead of migrating to the cytoplasm. The intensity of accumulation directly correlated with the extent of polytenisation in the PNC nuclei. We suggest that the otu mRNA remains partly attached to the polytene chromosome template after transcription and discuss the effects of this phenomenon on polytenisation of the PNC chromosomes.