Nucleotide sequence analysis has demonstrated that interspecific size variation in the YP2 yolk protein among Hawaiian Drosophila is due to in-frame insertions and deletions in two repetitive segments of the coding region of the Yp2 gene. Sequence comparisons of the complex repetitive region close to the 5' end of this gene across 34 endemic Hawaiian taxa revealed five length morphs, spanning a length difference of 21 nucleotides (nt). A phylogenetic character reconstruction of the length mutations on an independently derived molecular phylogeny showed clade-specific length variants arising from six ancient events: two identical insertions of 6 nt, and four deletions, one of 6 nt, one of 12 nt, and two identical but independent deletions of 15 nt. These mutations can be attributed to replication slippage with nontandem trinucleotide repeats playing a major role in the slipped-strand mispairing. Geographic analysis suggests that the 15 nt deletion which distinguishes the planitibia subgroup from the cyrtoloma subgroup occurred on Oahu about 3 million years ago. The homoplasies observed caution against relying too heavily on nucleotide insertions/deletions for phylogenetic inference. In contrast to the extensive repeat polymorphisms within other Drosophila and the human species, the more complex 5' Yp2 repetitive region analyzed here appears to lack polymorphism among Hawaiian Drosophila, perhaps due to founder effects, low population sizes, and hitchhiking effects of selection on the immediately adjacent 5' region.