Pseudogenes are fossil relatives of genes. Pseudogenes have long been thought of as "junk DNAs", since they do not code proteins in normal tissues. Although most of the human pseudogenes do not have noticeable functions, ∼20% of them exhibit transcriptional activity. There has been evidence showing that some pseudogenes adopted functions as lncRNAs and work as regulators of gene expression. Furthermore, pseudogenes can even be "reactivated" in some conditions, such as cancer initiation. Some pseudogenes are transcribed in specific cancer types, and some are even translated into proteins as observed in several cancer cell lines. All the above have shown that pseudogenes could have functional roles or potentials in the genome. Evaluating the relationships between pseudogenes and their gene counterparts could help us reveal the evolutionary path of pseudogenes and associate pseudogenes with functional potentials. It also provides an insight into the regulatory networks involving pseudogenes with transcriptional and even translational activities.In this study, we develop a novel approach integrating graph analysis, sequence alignment and functional analysis to evaluate pseudogene-gene relationships, and apply it to human gene homologs and pseudogenes. We generated a comprehensive set of 445 pseudogene-gene (PGG) families from the original 3,281 gene families (13.56%). Of these 438 (98.4% PGG, 13.3% total) were non-trivial (containing more than one pseudogene). Each PGG family contains multiple genes and pseudogenes with high sequence similarity. For each family, we generate a sequence alignment network and phylogenetic trees recapitulating the evolutionary paths. We find evidence supporting the evolution history of olfactory family (both genes and pseudogenes) in human, which also supports the validity of our analysis method. Next, we evaluate these networks in respect to the gene ontology from which we identify functions enriched in these pseudogene-gene families and infer functional impact of pseudogenes involved in the networks. This demonstrates the application of our PGG network database in the study of pseudogene function in disease context