It's the first time in NBA history that two college teammates were picked 1-2.
The last time one school had such a huge impact on the draft was in 1969, when Milwaukee drafted UCLA's Kareem-Abdul Jabbar with the No. 1 pick and Seattle used the third pick on Lucius Harris.
As expected, New Orleans took Davis with this year's No. 1 pick, securing a player some NBA personnel-types have compared to Tim Duncan.
In New Orleans, Davis returns to the city where Kentucky beat Kansas for the NCAA championship less than three months ago.
Davis shot only 1-for-10 in the title game, but he grabbed 16 rebounds, blocked six shots and was named the Most Outstanding Player at the Final Four.
"I just have to come in and play defense," Davis told the New Orleans Times-Picayune. "I know they are a defensive-oriented team, and I love to play defense. ...
"I think [with] my defensive ability, we can do a great job defending guys. At the same time, [I've] still got to put points on the board. So [I have to] make sure we work hard every day, stay in the gym and keep working."
With the second pick, Charlotte unexpectedly took Kidd-Gilchrist, an 18-year-old small forward who averaged 11.9 points as a freshman at Kentucky.
While Kidd-Gilchrist was a considered a top-five pick, few projections had him going as high as No. 2.
Charlotte owner Michael Jordan rolled the dice on a young player with a high ceiling, however, as the Bobcats try to emerge from a shadow cast by last season's 7-59 record.
With the third pick, Washington selected shooting guard Bradley Beal from Florida which, like Kentucky, is a member of the Southeast Conference.
It's the first time in 26 years that players from the same league were taken with the top three picks.
The last time it happened was 1986, when North Carolina's Brad Daugherty, Maryland's Len Bias and North Carolina State's Chris Washburn went 1-2-3.
In Beal, the Wizards added an outside shooter to pair with emerging point guard John Wall, who was the No. 1 overall pick in the 2010 draft.
"I think he's a great pick," Wall told The Washington Post. "So many people wanted to get to him, and I'm glad that we had the opportunity to pick him. He's somebody that can make shots, and he helps spread the court for you."
Kentucky's impact on the first round wasn't limited to Davis and Kidd-Gilchrist.
Power forward Terrence Jones was selected by Houston at No. 18, and Chicago used the 29th pick on point guard Marquis Teague.
Meanwhile, North Carolina also had four players selected in the first round.
Golden State took Harrison Barnes at No. 7, Phoenix drafted Kendall Marshall at No. 13, Milwaukee selected John Henson at No. 14 and Dallas grabbed Tyler Zeller at No. 18 before trading him to Cleveland.