The prevailing view of metazoan gene regulation is that individual genes are independently regulated by their own dedicated sets of transcriptional enhancers. Past studies have reported long-range gene–gene associations1,2,3, but their functional importance in regulating transcription remains unclear. Here we used quantitative single-cell live imaging methods to provide a demonstration of co-dependent transcriptional dynamics of genes separated by large genomic distances in living Drosophila embryos. We find extensive physical and functional associations of distant paralogous genes, including co-regulation by shared enhancers and co-transcriptional initiation over distances of nearly 250 kilobases. Regulatory interconnectivity depends on promoter-proximal tethering elements, and perturbations in these elements uncouple transcription and alter the bursting dynamics of distant genes, suggesting a role of genome topology in the formation and stability of co-transcriptional hubs. Transcriptional coupling is detected throughout the fly genome and encompasses a broad spectrum of conserved developmental processes, suggesting a general strategy for long-range integration of gene activity.