The systematics and phylogeny of the genus Arenaria and allied genera are unresolved. The use of morphological data has resulted in contradictory taxonomic concepts in the past due to their homoplastic nature. We present a phylogenetic analysis based on internal transcribed spacer (ITS) and rps16 sequence data of 140 (132 taxa) and 131 (120 taxa) accessions, respectively. Maximum parsimony and Bayesian analyses of each marker produced nearly congruent trees. Monophyly of Arenaria s.s. and Eremogone is confirmed here. Our results corroborate earlier results indicating that Arenaria subgenus Odontostemma is monophyletic, but outside the core group of Arenaria. Arenaria subgenus Solitaria is sister to Odontostemma and also not closely related to the latter; both of these subgenera are excluded from Arenaria and treated as distinct genera. The molecular data indicate that the ‘Arenaria s.s. clade’ consists of a few well‐supported subgroups and that the current subgeneric classification of the genus does not reflect evolutionary history. Arenaria subgenus Leiosperma is clearly monophyletic, but we reduce it to sectional level. Our molecular data show that the monotypic Arenaria subgenera Porphyrantha and Arenariastrum are nested in A. subgenus Arenaria, whereas subgenus Eremogoneastrum is included in Eremogone. None of the species‐rich sections in subgenus Arenaria is monophyletic. © 2015 The Linnean Society of London, Botanical Journal of the Linnean Society, 2015, 178, 648–669.