Long-term specialization may limit the ability of a species to respond to new environmental conditions and lead to a higher likelihood of extinction. For permanent parasites and other symbionts, the most intriguing question is whether these organisms can return to a free-living lifestyle and, thus, escape an evolutionary "dead end." This question is directly related to Dollo's law, which stipulates that a complex trait (such as being free living vs. parasitic) cannot re-evolve again in the same form. Here, we present conclusive evidence that house dust mites, a group of medically important free-living organisms, evolved from permanent parasites of warm-blooded vertebrates. A robust, multigene topology (315 taxa, 8942 nt), ancestral character state reconstruction, and a test for irreversible evolution (Dollo's law) demonstrate that house dust mites have abandoned a parasitic lifestyle, secondarily becoming free living, and then speciated in several habitats. Hence, as exemplified by this model system, highly specialized permanent parasites may drastically de-specialize to the extent of becoming free living and, thus escape from dead-end evolution. Our phylogenetic and historical ecological framework explains the limited cross-reactivity between allergens from the house dust mites and "storage" mites and the ability of the dust mites to inhibit host immune responses. It also provides insights into how ancestral features related to parasitism (frequent ancestral shifts to unrelated hosts, tolerance to lower humidity, and pre-existing enzymes targeting skin and keratinous materials) played a major role in reversal to the free-living state. We propose that parasitic ancestors of pyroglyphids shifted to nests of vertebrates. Later the nest-inhabiting pyroglyphids expanded into human dwellings to become a major source of allergens.