Species of the subgenus Leishmania (Leishmania) cause the debilitating disease leishmaniasis on four continents. Species grouped within the Leishmania donovani complex cause visceral leishmaniasis, a life-threatening disease, often associated with poverty, and affecting some 0.5 million people each year. The Leishmania glycoprotein GP63, or major surface protease, is a metalloprotease involved in parasite survival, infectivity and virulence. Here, we show that evolution of the gp63 multigene family is influenced by mosaic or fragmental gene conversion. This is a major evolutionary force for both homogenisation and for generating diversity, even in the absence of sexual reproduction. We propose here that the high GC content at the third codon position in the gp63 family of Old World Leishmania may be higher in multicopy regions, under the biased gene conversion model, because increased copy numbers may lead to increased rates of recombination. We confirm that one class of gp63 genes with an extended 3'end signal, gp63(EXT), reveals genetic groups within the complex and gives insights into evolution and host associations. Gp63(EXT) genes can also provide the basis for rapid and reliable genotyping of strains in the L. donovani complex. Our results confirmed that a more stringent definition of Leishmania infantum is required and that the species Leishmania archibaldi should be suppressed.