Smooth pufferfish of the family Tetraodontidae have the smallest vertebrate genomes yet measured. They have a haploid genome size of ∼400 million bp (Mb), which is almost eight times smaller than the human genome. Given that spiny pufferfish from the sister family Diodontidae and a fish from the outgroup Molidae have genomes twice as large as smooth puffers, it appears that the genome size of smooth puffers has contracted in the last 50–70 million years since their divergence from the spiny puffers. Here we use renaturation kinetics to compare the repetitive nature of the smooth and spiny puffer genomes. We also estimate the rates of small (<400 bp) insertions and deletions in smooth and spiny puffers using defunct non-LTR retrotransposons. We find a significantly greater abundance of a transposon-like repetitive DNA class in spiny puffers relative to smooth puffers, in addition to nearly identical indel rates. We comment on the role that large insertions may play in the evolution of genome size in these two groups.[The sequence data from this study have been submitted to GenBank under accession nos. AY212336–AY212504.]