Bryozoa is one of the most puzzling phyla in the animal kingdom and little is known about their evolutionary history. Its phylogenetic position among the Metazoa remains unsettled, as well as its intra-phylum relationships. Here, we present the first comprehensive molecular phylogeny of Bryozoa based on the mitochondrial gene COI and two nuclear genes 18S rDNA and 28S rDNA including 32 species from 23 families. We show that the monophyletic status is supported for the phylum as well as for previously defined bryozoan classes. The 28S rDNA supports a close relationship of Phylactolaemata and Stenolaemata, while partial COI and 18S rDNA show the freshwater Phylactolaemata as basal bryozoans. The Gymnolaemata have generally been divided into soft-bodied forms (Ctenostomata) and hard-bodied species (Cheilostomata). In our analyses all three genes conflict with this assumption and show hard body forms having evolved within Gymnolaemata several times.