We present the first overall molecular phylogenetic study of Casuarinaceae on the basis of sequences of two chloroplast genes, rbcL (1310 bp) and matK (1014 bp), using 15 species representing the family. The study included analyses of Ticodendron (Ticodendraceae) and three species of Betulaceae as close relatives, and one species each of Juglandaceae and Myricaceae as outgroups. Analyses based on matK gene sequences, which provided a much better resolution than the analyses based on rbcL gene sequences alone, resulted in a single most parsimonious tree whose topology is almost identical with the strict consensus tree generated by the combined data set of rbcL and matK gene sequences. Results showed that Casuarinaceae are monophyletic, comprising four distinct genera, A//ocasuarina, Casuarina, Ceuthostoma and Gymnostoma, which were not recognized until recently. Within the family, Gymnostoma is positioned at the most basal position and sister to the remainder. Within the remainder Ceuthostoma is sister to the A//ocasuarina-Casuarina clade. Morphologically the basalmost position of Gymnostoma is supported by plesiomorphies such as exposed stomata in the shallow longitudinal furrows of the branchlets, a basic chromosome number x=8 and the gynoecium composed of two fertile, biovulate carpels. The three other genera, A//ocasuarina, Casuarina, and Ceuthastoma, have invisible stomata in the deep longitudinal furrows of the branchlets, a higher basic chromosome number x=9 or 10-14 (unknown in Ceuthostoma), the gynoecium composed of one fertile and one sterile carpel with a single ovule (unknown in Ceuthastoma). The diversity of infructescence morphology found in the latter three genera suggests that they may have evolved in close association with the elaboration of fruit dispersal mechanisms.