Prokaryotic cells employ multiple protective layers crucial for defense, structural integrity, and cellular interactions in the environment. Archaea often feature an S-layer, with some species possessing additional and remarkably resistant sheaths. The archaeal sheath has been studied in Methanothrix and Methanospirillum, revealing a complex structure consisting of amyloid proteins organized into rings. Here, we conducted a comprehensive survey of sheath-forming proteins (SH proteins) across archaeal genomes. Structural modeling reveals a rich diversity of SH proteins, indicating the presence of a sheath in members of the TACK superphylum (Thermoprotei), as well as in the methanotrophic ANME-1. SH proteins are present in up to 40 copies per genome and display diverse domain arrangements suggesting multifunctional roles within the sheath, and potential involvement in cell–cell interaction with syntrophic partners. We uncover a complex evolutionary dynamic, indicating active exchange of SH proteins in archaeal communities. We find that viruses infecting sheathed archaea encode a diversity of SH-like proteins and we use them as markers to identify 580 vOTUs potentially associated with sheathed archaea. Structural modeling suggests that viral SH proteins can form complexes with the host SH proteins. We propose a previously unreported egress strategy where the expression of viral SH-like proteins may disrupt the integrity of the host sheath and facilitate viral exit during lysis. Together, our results significantly expand knowledge of the diversity and evolution of the archaeal sheath, which has been largely understudied but might have an important role in shaping microbial communities.