Gene duplication is an evolutionary process in which the emergent property of the whole can become greater and different than the sum of its parts. One potential outcome for gene duplication is for loci to evolve different, yet related functions. In this case, intergenic exchange can shuffle blocks of differentiated nucleotides between paralogues to create new alleles and phenotypes rather than simply homogenize loci. Bioluminescent click beetles in the genus Pyrophorus (Coleoptera: Elateridae) provide an opportunity to explore the creative potential of intergenic exchange for gene family evolution. Pyrophorus beetles bioluminesce different light colors from a pair of dorsal light organs and a ventral light organ. The light organs are under the separate genetic control of dorsal and ventral luciferase loci. Here, we report that intergenic exchange is common between dorsal and ventral loci for beetles from Jamaica (P. plagiophthalamus), the Dominican Republic (P. mellifluous), Belize (P. luscus), and Trinidad (P. noctilucus). We also present evidence that periods of past geographic isolation for beetles on Jamaica, probably acting in concert with selection, built differentiated blocks of substitutions within dorsal and ventral P. plagiophthalamus luciferase loci. Gene flow and intergenic exchange subsequently shuffled these substitutions between dorsal and ventral loci to produce new color phenotypes on Jamaica, including a yellow-green polymorphism. We discuss the possibility of a previously unrecognized emergent evolutionary property of intergenic exchange for luciferase involving cycles of bioluminescent color change related to differences in selective constrains acting on dorsal versus ventral loci. We also explore whether intergenic exchange may commonly create novel variation and the potential for cyclic evolution in other multigene family systems.