Abstract Many insects rely on bacterial endosymbionts to obtain nutrients that are scarce in their highly specialized diets. The most surprising example corresponds to the endosymbiotic system found in mealybugs from subfamily Pseudococcinae in which two bacteria, the betaproteobacterium ‘Candidatus Tremblaya princeps’ and a gammaproteobacterium, maintain a nested endosymbiotic consortium. In the sister subfamily Phenacoccinae, however, a single beta-endosymbiont, ‘Candidatus Tremblaya phenacola’, has been described. In a previous study, we detected a trpB gene of gammaproteobacterial origin in ‘Ca. Tremblaya phenacola’ from two Phenacoccus species, apparently indicating an unusual case of horizontal gene transfer (HGT) in a bacterial endosymbiont. What we found by sequencing the genome of ‘Ca. Tremblaya phenacola’ PPER, single endosymbiont of Phenacoccus peruvianus, goes beyond a HGT phenomenon. It rather represents a genome fusion between a beta and a gammaproteobacterium, followed by massive rearrangements and loss of redundant genes, leading to an unprecedented evolutionary collage. Mediated by the presence of several repeated sequences, there are many possible genome arrangements, and different subgenomic sequences might coexist within the same population.