Horizontal gene transfer (HGT), or the transfer of genes between species, has been recognized recently as more pervasive than previously suspected. Here, we report evidence for an unprecedented degree of HGT into an animal genome, based on a draft genome of a tardigrade, Hypsibius dujardini. Tardigrades are microscopic eight-legged animals that are famous for their ability to survive extreme conditions. Genome sequencing, direct confirmation of physical linkage, and phylogenetic analysis revealed that a large fraction of the H. dujardini genome is derived from diverse bacteria as well as plants, fungi, and Archaea. We estimate that approximately one-sixth of tardigrade genes entered by HGT, nearly double the fraction found in the most extreme cases of HGT into animals known to date. Foreign genes have supplemented, expanded, and even replaced some metazoan gene families within the tardigrade genome. Our results demonstrate that an unexpectedly large fraction of an animal genome can be derived from foreign sources. We speculate that animals that can survive extremes may be particularly prone to acquiring foreign genes.