Sexuality and reproductive mode are two fundamental life-history traits that exhibit largely unexplained macroevolutionary patterns among the major groups of multicellular organisms. For example, the cnidarian class Anthozoa (corals and anemones) is mainly comprised of gonochoric (separate sex) brooders or spawners, while one order, Scleractinia (skeleton-forming corals), appears to be mostly hermaphroditic spawners. Here, using the most complete phylogeny of scleractinians, we reconstruct how evolutionary transitions between sexual systems (gonochorism versus hermaphrodism) and reproductive modes (brooding versus spawning) have generated large-scale taxonomic patterns in these characters. Hermaphrodites have independently evolved in three large, distantly related lineages consisting of mostly reef-building species. Reproductive mode in corals has evolved at twice the rate of sexuality, while the evolution of sexuality has been heavily biased: gonochorism is over 100 times more likely to be lost than gained, and can only be acquired by brooders. This circuitous evolutionary pathway accounts for the prevalence of hermaphroditic spawners among reef-forming scleractinians, despite their ancient gonochoric heritage.