Reduced birth weight and slow neonatal growth are risks correlated with the development of common diseases in adulthood. The Human Growth Hormone/Chorionic Somatomammotropin (hGH/CSH) gene cluster (48 kb) at 17q22-24, consisting of one pituitary-expressed postnatal (GH1) and four placental genes (GH2, CSH1, CSH2, and CSHL1) may contribute to common variation in intrauterine and infant growth, and also to the regulation of feto-maternal and adult glucose metabolism. In contrast to GH1, there are limited genetic data on the hGH/CSH genes expressed in utero. We report the first survey of sequence variation encompassing all five hGH/CSH genes. Resequencing identified 113 SNPs/indels (ss86217675-ss86217787 in dbSNP) including 66 novel variants, and revealed remarkable differences in diversity patterns among the homologous duplicated genes as well as between the study populations of European (Estonians), Asian (Han Chinese), and African (Mandenkalu) ancestries. A dominant feature of the hGH/CSH region is hyperactive gene conversion, with the rate exceeding tens to hundreds of times the rate of reciprocal crossing-over and resulting in near absence of linkage disequilibrium. The initiation of gene conversion seems to be uniformly distributed because the data do not predict any recombination hotspots. Signatures of different selective constraints acting on each gene indicate functional specification of the hGH/CSH genes. Most strikingly, the GH2 coding for placental growth hormone shows strong intercontinental diversification (F(ST)=0.41-0.91; p<10(-6)) indicative of balancing selection, whereas the flanking CSH1 exhibits low population differentiation (F(ST)=0.03-0.09), low diversity (non-Africans, pi=8-9 x 10(-5); Africans, pi=8.2 x 10(-4)), and one dominant haplotype worldwide, consistent with purifying selection. The results imply that the success of an association study targeted to duplicated genes may be enhanced by prior resequencing of the study population in order to determine polymorphism distribution and relevant tag-SNPs.