Carica papaya maintains an abnormally small but complete NLR family while showing weak disease resistance. To better understand their origin, evolution, and biological function, we identified 59 NLR genes via a customized RGAugury and investigated their characteristics, evolutionary history, and expression profiles based on the improved papaya genome and large-scale RNA-seq data. The results indicated that duplication is a major evolutionary force driving the formation of the papaya NLR family. Synteny analyses of papaya and other angiosperms showed that both insertion and inheritance-derived NLRs are present in papaya. Transcriptome-based expression and network analyses revealed that NLRs are actively involved in biotic stress responses. For example, a papaya-specific inserted TNL was up-regulated strongly by the fungal infection. Both transcriptome and qRT-PCR analyses confirmed the expression divergence of an RNL and an RCNL, a pair of tandem duplication genes involved in different co-expression modules. Furthermore, we observed an inserted gene cluster composed of five duplicated CNLs, showing dosage effects and functional differentiation of disease-resistance genes during evolution. This research will enhance our knowledge of the special NLR family in papaya, which may serve as a model plant for disease-resistance genetic studies.