Ribosomal DNA (rDNA) internal transcribed spacer (ITS) and 5.8S rDNA sequences were obtained from 22 species of dwarfmistletoes (Arceuthobium -Viscaceae) to test phylogenetic relationships. Interspecific distances ranged from 0 to 21.4% between New World species, values two to five times higher than those measures for the ITS region in other plants. One Old World species (A. oxycedri) and one New World species (A. abietis-religiosae) were remarkably similar to each other but exhibited up to 41% sequence divergence from the remaining species. Minimum length trees support the concept of a verticillately branched subgenus Arceuthobium; however, interspecific distances indicate this group is extremely heterogeneous. Subgenus Vaginata, Section Vaginata, is centered in Mexico and encompasses all the taxa previously placed in this group but is expanded to include several species previously classified in Section Campy/opoda (e.g., A. divaricatum, A. rubrum, and A. strictum). The sister group relationship between A. divaricatum and A. douglasii, first seen following isozyme analysis, is supported by ITS sequence data. Section Campy/opoda s. s. is now composed of 13 mainly U.S. species that show a high degree of morphological and genetic similarity. The eastern dwarf mistletoe, A. pusillum, is not closely related to A. doug/asii but rather with A. bicarinatum from Hispaniola, which suggests that these taxa represent highly modified relicts that shared an ancestor in the early Tertiary. Two endemic species from Mexico and Central America (A. guatemalense and A. pendens) formed a sister group and have been placed in a new Section (penda). Rapid molecular evolution in Arceuthobium may be associated with the adaptive radiation of this genus on numerous conifer hosts.