The freshwater cnidarian Hydra was first described in 17021 and has been the object of study for 300 years. Experimental studies of Hydra between 1736 and 1744 culminated in the discovery of asexual reproduction of an animal by budding, the first description of regeneration in an animal, and successful transplantation of tissue between animals2. Today, Hydra is an important model for studies of axial patterning3, stem cell biology4 and regeneration5. Here we report the genome of Hydra magnipapillata and compare it to the genomes of the anthozoan Nematostella vectensis6 and other animals. The Hydra genome has been shaped by bursts of transposable element expansion, horizontal gene transfer, trans-splicing, and simplification of gene structure and gene content that parallel simplification of the Hydra life cycle. We also report the sequence of the genome of a novel bacterium stably associated with H. magnipapillata. Comparisons of the Hydra genome to the genomes of other animals shed light on the evolution of epithelia, contractile tissues, developmentally regulated transcription factors, the Spemann–Mangold organizer, pluripotency genes and the neuromuscular junction.

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Wnt genes and beta-catenin signaling are involved in axial patterning processes in vertebrate embryogenesis in setting up the Spemann-Mangold organizer in amphibian embryos. An organizer with a similar function is present in the hypostome of an adult Hydra polyp. Previously, a Hydra ortholog of Wnt3 (HyWnt3), which is expressed in the hypostome, has been described. Here, ten additional Hydra Wnt genes have been identified. Of these, six (HyWnt1, -7, -9/10a, -9/10c, -11, and -16) are expressed in the adult hypostome. And, as is HyWnt3, these six Wnt genes are also expressed when a new head organizer is formed during head regeneration and bud formation. The kinetics of Wnt gene expressions during head regeneration suggests that a cascade of consecutive Wnt activation accompanies regeneration, and HyWnt3 begins this cascade. Recombinant HyWnt3 protein induced body column tissue to undergo head formation. It also increased the head formation capacity in the head regeneration-deficient mutant strain reg-16 to that of wild-type strains. In addition our data reveal striking similarities in the molecular basis of the organizer in Hydra and axis polarization in chordates (e.g. Spemann's organizer) as well as it's role in regeneration suggesting a conserved function of Wnt signaling in setting up this ancient metazoan signaling center.

characteristics of the head organizer, as measured by transplantation experiments, and by the expression of genes associated with the head organizer. Hence, the role of the canonical Wnt pathway for the initiation of axis formation was established early in metazoan evolution.

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