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This paper presents two-way clustering of microarray data using fuzzy adaptive subspace iteration (ASI) based algorithm for knowledge discovery in microarrays. It is widely believed that each gene is involved in more than one cellular function or biological process. The proposed fuzzy ASI assigns a relevance value to each gene associated with each cluster. These functional categories are ranked based on their potential in providing maximal separation between the two tissues classes; which is an indication of differentially expressed genes (DEGs). Empirical analyses on simulated, 100 artificial microarray datasets are used to quantify the results obtained using the fuzzy-ASI algorithm. Further analyses on different microarray cancer datasets revealed several important genes that are relevant with various cancers.