Multidomain proteins usually contain several conserved and apparently independently evolved domains. As a result, classifications based on only a single small domain may obscure the true evolutionary relationships of the proteins. The current classification of basic helix-loop-helix (bHLH) domain-containing proteins is based on the conserved bHLH domain alone. Herein, we explore whether sequence homology and, therefore, evolutionary relationships can be detected among the flanking or non-bHLH components of the amino acid sequences of 122 bHLH proteins. These 122 proteins were the same proteins previously used to construct the existing classification of the bHLH-domain-containing proteins. Several possible scenarios are examined in order to explain the observed patterns of sequence divergence, including (1) monophyly, (2) convergent evolution, (3) addition of functional components to the bHLH domain, and (4) modular evolution with domain shuffling. Drawing on several lines of evidence, we suggest that modular evolution by domain shuffling may have played an important role in the evolution of this large group of transcriptional regulators.