Halichoeres is a widely distributed coral reef fish genus with high levels of biodiversity in both the Indo-Pacific and New World tropics. This study employed molecular phylogenetic techniques and biogeographic analyses on 1700-1800 bp of mitochondrial CO1, 16s, and 12s to test competing hypotheses regarding the origins of biodiversity in this genus in these two biodiversity hotspots. Analyses indicate that Halichoeres is polyphyletic with distinct New World and Indo-Pacific Ocean components. The Halichoeres in the New World tropics formed a strongly supported clade (99% MP, 100% ML bootstrap values) that diverged 21.2-18.1 mya, suggesting that this lineage may represent a relictual fauna of the ancient Tethys Sea. The closure of the Isthmus of Panama contributed to the creation of Halichoeres biodiversity, but diversification across the Isthmus prior to its closure and within the W. Atlantic after the closure 3.1 mya were also important processes creating biodiversity in the New World tropics. Within the Indonesian Australian Archipelago (IAA) analysis of age vs. geographic distribution supported neither Center of Origin, Center of Accumulation or Center of Overlap hypotheses, and molecular clock estimates indicated that the role of Pleistocene sea level changes in the origins of IAA marine biodiversity may be less important than previously thought. Ancestral distribution reconstructions within the Indo-West Pacific (IWP) clade (99% ML bootstrap value) also failed to support these hypotheses as the reconstructions were highly sensitive to the inclusion of missing taxa. Results suggest plueralistic origins of biodiversity, but that vast amounts of habitat may favor the survival of biodiversity in the IAA biodiversity hotspot.