A fundamental gap in the study of the origin of limbed vertebrates lies in understanding the morphological and functional diversity of their closest relatives. Whereas analyses of the elpistostegalians Panderichthys rhombolepis, Tiktaalik roseae and Elpistostege watsoni have revealed a sequence of changes in locomotor, feeding and respiratory structures during the transition1–9, an isolated bone, a putative humerus, has controversially hinted at a wider range in form and function than now recognized10–14. Here we report the discovery of a new elpistostegalian from the Late Devonian period of the Canadian Arctic that shows surprising disparity in the group. The specimen includes partial upper and lower jaws, pharyngeal elements, a pectoral fin and scalation. This new genus is phylogenetically proximate to T. roseae and E. watsoni but evinces notable differences from both taxa and, indeed, other described tetrapodomorphs. Lacking processes, joint orientations and muscle scars indicative of appendage-based support on a hard substrate13, its pectoral fin shows specializations for swimming that are unlike those known from other sarcopterygians. This unexpected morphological and functional diversity represents a previously hidden ecological expansion, a secondary return to open water, near the origin of limbed vertebrates.