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Jellyfish (medusae) are a distinctive life-cycle stage of medusozoan cnidarians. They are major marine predators, with integrated neurosensory, muscular and organ systems. The genetic foundations of this complex form are largely unknown. We report the draft genome of the hydrozoan jellyfish Clytia hemisphaerica and use multiple transcriptomes to determine gene use across life-cycle stages. Medusa, planula larva and polyp are each characterised by distinct transcriptome signatures reflecting abrupt life cycle transitions, and all deploy a mixture of phylogenetically old and new genes. Medusa specific transcription factors, including many with bilaterian orthologs, associate with diverse neurosensory structures. Compared to Clytia, the polyp-only hydrozoan Hydra has lost many of the medusa-expressed transcription factors, despite similar overall rates of gene content and sequence evolution. Absence of expression and gene loss among Clytia orthologs of genes patterning the anthozoan aboral pole, secondary axis and endomesoderm support simplification of planulae and polyps in Hydrozoa, including loss of bilateral symmetry. Consequently, although the polyp and planula are generally considered the ancestral cnidarian forms, in Clytia the medusa maximally deploys ancestral cnidarian–bilaterian transcription factor gene complexity.

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