The superphylum Panarthropoda (Arthropoda, Onychophora, and Tardigrada) exhibits a remarkable diversity of segment morphologies, enabling these animals to occupy diverse ecological niches. The molecular identities of these segments are specified by Hox genes and other axis patterning genes during development [1, 2]. Comparisons of molecular segment identities between arthropod and onychophoran species have yielded important insights into the origins and diversification of their body plans [3-9]. However, the relationship of the segments of tardigrades to those of arthropods and onychophorans has remained enigmatic [10, 11], limiting our understanding of early panarthropod body plan diversification. Here, we reveal molecular identities for all of the segments of a tardigrade. Based on our analysis, we conclude that tardigrades have lost a large intermediate region of the body axis-a region corresponding to the entire thorax and most of the abdomen of insects-and that they have lost the Hox genes that originally specified this region. Our data suggest that nearly the entire tardigrade body axis is homologous to just the head region of arthropods. Based on our results, we reconstruct a last common ancestor of Panarthropoda that had a relatively elongate body plan like most arthropods and onychophorans, rather than a compact, tardigrade-like body plan. These results demonstrate that the body plan of an animal phylum can originate by the loss of a large part of the body.