Reconstruction of phylogenetic relationships among recently diverged species is complicated by three general problems: segregation of polymorphisms that pre-date species divergence, gene flow during and after speciation, and intra-locus recombination. In light of these difficulties, the Y chromosome offers several important advantages over other genomic regions as a source of phylogenetic information. These advantages include the absence of recombination, rapid coalescence, and reduced opportunity for interspecific introgression due to hybrid male sterility. In this report, we test the phylogenetic utility of Y-chromosomal sequences in two groups of closely related and partially inter-fertile Drosophila species. In the D. bipectinata species complex, Y-chromosomal loci unambiguously recover the phylogeny most consistent with previous multi-locus analysis and with reproductive relationships, and show no evidence of either post-speciation gene flow or persisting ancestral polymorphisms. In the D. simulans species complex, the situation is complicated by the duplication of at least one Y-linked gene region, followed by intrachromosomal recombination between the duplicate genes that scrambles their genealogy. We suggest that Y-chromosomal sequences are a useful tool for resolving phylogenetic relationships among recently diverged species, especially in male-heterogametic organisms that conform to Haldane's rule. However, duplication of Y-linked genes may not be uncommon, and special care should be taken to distinguish between orthologous and paralogous sequences.