Pseudogene transcripts can provide a novel tier of gene regulation through generation of endogenous siRNAs or miRNA-binding sites. Characterization of pseudogene expression, however, has remained confined to anecdotal observations due to analytical challenges posed by the extremely close sequence similarity with their counterpart coding genes. Here, we describe a systematic analysis of pseudogene “transcription” from an RNA-Seq resource of 293 samples, representing 13 cancer and normal tissue types, and observe a surprisingly prevalent, genome-wide expression of pseudogenes that could be categorized as ubiquitously expressed or lineage and/or cancer specific. Further, we explore disease subtype specificity and functions of selected expressed pseudogenes. Taken together, we provide evidence that transcribed pseudogenes are a significant contributor to the transcriptional landscape of cells and are positioned to play significant roles in cellular differentiation and cancer progression, especially in light of the recently described ceRNA networks. Our work provides a transcriptome resource that enables high-throughput analyses of pseudogene expression. Display omitted ► Large-scale transcriptome analysis examines the expression of human pseudogenes ► Pseudogene expression can be ubiquitous or lineage or cancer specific ► ATP8A2Ψ and CXADRΨ show specific breast and prostate cancer expression, respectively ► The study provides a framework for analyzing pseudogene expression from RNA-Seq data A large-scale analysis of human pseudogenes from 13 tumor and normal tissue types shows tissue- and cancer-specific expression patterns. Examples from prostate and breast cancer illustrate functional roles for a class of genes often thought of as “junk DNA.”