Recent studies on transposable elements (TEs) have shed light on the mechanisms that have shaped their evolution. In addition to accumulating nucleotide substitutions over evolutionary time, TEs appear to be especially prone to genetic rearrangements and vertical transmissions across even distantly related species. As a consequence of replicating in host genomes, TEs have a significant mutational effect on their hosts. Although most TE-insertion mutations seem to exert a negative effect on host fitness, a growing body of evidence indicates that some TE-mediated genetic changes have become established features of host species genomes indicating that TEs can contribute significantly to organismic evolution.