AbstractEvolutionary mechanisms underlying innovation of cell types have remained largely unclear. In multicellular eukaryotes, the evolutionary molecular origin of sperm differentiation is unknown in most lineages. Here, we report that in algal ancestors of land plants, changes in the DNA-binding domain of the ancestor of the MYB transcription factor DUO1 enabled the recognition of a new cis-regulatory element. This event led to the differentiation of motile sperm. After neo-functionalization, DUO1 acquired sperm lineage-specific expression in the common ancestor of land plants. Subsequently the downstream network of DUO1 was rewired leading to sperm with distinct morphologies. Conjugating green algae, a sister group of land plants, accumulated mutations in the DNA-binding domain of DUO1 and lost sperm differentiation. Our findings suggest that the emergence of DUO1 was the defining event in the evolution of sperm differentiation and the varied modes of sexual reproduction in the land plant lineage.