Homalozoans include four classes of non-pentamerous Paleozoic echinoderms: Homostelea (cinctans), Ctenocystoidea (ctenoid-bearing homalozoans), Homoiostelea (solutes), and Stylophora (cornutes and mitrates). Their atypical morphologies have historically made it difficult to relate them to other classes. Therefore, their systematic positions have been represented by two hypotheses (H): as stem taxa to echinoderms (H1) or as stem taxa to chordates (H2). These conclusions rest on previous inability to recognize synapomorphies with more crownward echinoderms, resulting in a forcing of the homalozoans down the phylogenetic tree that is more artifactual than evolutionary. The Extraxial-Axial Theory (EAT) identifies body-wall homologies, common ontogenetic patterns, and major events in bodyplan evolution. Therefore, the EAT can identify synapomorphies among even the most disparate of echinoderms. Application of the EAT undermines both H1 and H2 and strongly suggests that the bizarre asymmetry of homalozoans is a derived characteristic, and not indicative of plesiomorphic morphology for either chordates or echinoderms. Each of the four homalozoan clades and their major features are reexamined using the EAT. New findings are presented concerning homologies of thecal body wall, but we focus on stems, arms, and brachioles, which are recognized as very distinct products of independent evolutionary events. The results support a new interpretation (H3) of homalozoans as a polyphyletic assemblage that can be parsed out into other, clearly echinoderm clades. The Homoiostelea and Homostelea share the blastozoan synapomorphy of a brachiole. The enigmatic Ctenocystoidea also seem to have brachioles. The Stylophora have an arm as in crinoids. H3 is also more congruent with the known fossil record. Although they are stratigraphically early echinoderms, homalozoans are not indicative of the plesiomorphic morphology of the phylum.