SignificanceMutagenic AID/APOBEC deaminases (AADs) are central to processes such as generation of antibody diversity and antiviral defense in vertebrates. Their presence and role outside vertebrates are poorly characterized. We report the discovery of several AADs, including some that are secreted, across diverse metazoan, dictyosteliid, and algal lineages. They appear to have emerged from an early transfer of an AAD from bacterial toxin systems, followed by extensive diversification into multiple eukaryotic clades, showing dramatic structural innovation, rapid divergence, gene loss, polymorphism, and lineage-specific expansions. We uncover evidence for their divergence in arms-race scenarios with viruses and genomic retroelements and show that AAD-based nucleic acid mutagenesis as a basis of immune defense is widespread across metazoa, slime molds, and algae.