How features characteristic of multicellular animals emerged in evolution and how the body plan of particular taxa was shaped are hotspots of modern evolutionary biology. We can get closer to answering them by studying animals that occupy a basal position on the phylogenetic tree, such as sponges (Porifera). We sequenced the genome of the spongeHalisarca dujardiniiusing Oxford Nanopore and Illumina technologies and made an assembly of long reads, followed by polishing with short reads. The resulting assembly had a size of 176 Mb, matching the prediction from the k-mer distribution, and an N50 of about 785 Kb. By analyzing transposable elements in the genomes ofH. dujardiniiand a number of other sponges, we found that a significant portion of the genome (more than half for Demospongiae) is occupied by repeats, most of which are evolutionary young. RNA-seq data were used to predict about 14000 genes in the genome, several times less than in other Demospongiae. By analyzing ortholog groups unique toH. dujardiniiamong sponges and higher invertebrates, we found overrepresented genes related to the extracellular matrix. The extracellular matrix ofH. dujardiniicontains, among others, key basement membrane components such as laminin, nidogen, fibronectin, and collagen IV, for which phylogenetic analysis has confirmed that it belongs to this type of nonfibrillar collagen. In addition, we showed inH. dujardinii14 aggregation factor genes responsible for cell recognition and adhesion. They are organized in a genomic cluster and have at least two types of domains: Calx-beta, responsible for calcium ion binding, and Wreath domain, unique for this type of molecules. Our obtained assembly and annotation will further expand the understanding of genome evolution at the emergence of animal multicellularity, and will serve as a tool to study the regulation of gene expression by modern methods.