Processed genes are created by retroposition from messenger RNA of expressed genes. The estimated amount of processed copies of genes in the human genome is 10,000-14,000. Some of these might be pseudogenes with the expected pattern for nonfunctional sequences, but some others might be an important source of new genes. We have studied the evolution of a Phosphoglycerate mutase processed gene (PGAM3) described in humans and believed to be a pseudogene. We sequenced PGAM3 in chimpanzee and macaque and obtained polymorphism data for human coding region. We found evidence that PGAM3 likely produces a functional protein, as an example of addressing functionality for human processed pseudogenes. First, the open reading frame was intact despite many deletions that occurred in the 3' untranslated region. Second, it appears that the gene is expressed. Finally, interspecies and intraspecies variation for PGAM3 was not consistent with the neutral model proposed for pseudogenes, suggesting that a new functional primate gene has originated. Amino acid divergence was significantly higher than synonymous divergence in PGAM3 lineage, supporting positive selection acting in this gene. This role of selection was further supported by the excess of rare alleles in a population genetic analysis. PGAM3 is located in a region of very low recombination; therefore, it is conceivable that the rapid fixation events in this newly arising gene may have contributed to a selective sweep of variation in the region.