The paper nautilus, Argonauta argo, also known as the greater argonaut, is a species of octopods distinctly characterized by its pelagic lifestyle and by the presence of a spiral-shaped shell-like eggcase in females. The eggcase functions by protecting the eggs laid inside it, and by building and keeping air intakes for buoyancy. To reveal the genomic background of the species’ adaptation to pelagic lifestyle and the acquisition of its shell-like eggcase, we sequenced the draft genome sequence of the species. The genome size was 1.1 Gb, which is the smallest among the cephalopods known to date, with the top 215 scaffolds (average length 5,064,479 bp) covering 81% (1.09 Gb) of the total assembly. A total of 26,433 protein-coding genes were predicted from 16,802 assembled scaffolds. From these, we identified nearly intact HOX, Parahox, Wnt clusters and some gene clusters probably related to the pelagic lifestyle, such as reflectin, tyrosinase, and opsin. For example, opsin might have undergone an extensive duplication in order to adapt to the pelagic lifestyle, as opposed to other octopuses, which are mostly the benthic. Our gene models also discovered several genes homologous to those related to calcified shell formation in Conchiferan Mollusks, such as Pif-like, SOD, and TRX. Interestingly, comparative genomics analysis revealed that the homologous genes for such genes were also found in the genome of the octopus, which does not have a shell, as well as the basal cephalopods Nautilus. Therefore, the draft genome sequence of A. argo we presented here had not only helped us to gain further insights into the genetic background of the dynamic recruitment and dismissal of genes for the formation of an important, converging extended phenotypic structure such as the shell and the shell-like eggcase, but also the evolution of lifestyles in Cephalopods and the octopods, from benthic to pelagic.