Aponogeton is an important genus whose species are cultivated widely as ornamental aquatic plants. Although a fairly recent monograph has been published, the genus remains poorly studied systematically. We conducted a phylogenetic survey of Aponogeton that focused on relationships among the nine native Australian species as well as their relationship to other members of the genus. Our analyses included a phylogenetic assessment of morphological characters and molecular data obtained both from chloroplast (trnK 5′ intron, matK) and nuclear DNA (nrITS) loci. Molecular data provided evidence of hybridization and polyploidy as well as an informative overview of interspecific relationships in the genus. Two potentially new Australian species also were identified by the molecular data. Combined molecular data produced a well-resolved cladogram that enabled us to evaluate previous phylogenetic hypotheses based on non-explicit methods as well as the soundness of the existing classification of the genus. We conclude that Aponogetonaceae originated in Australia and subsequently radiated into Africa, Madagascar, and Asia, from which a secondary Australian diversification occurred resulting in a biphyletic origin of the native Australian species. A pattern of morphological distinctiveness coupled with low molecular divergence indicates relatively recent and rapid speciation of Aponogeton in Australia. Our results also demonstrate that in this group, morphological data are extremely unreliable taxonomically due to their extensive homoplasy. The phylogenetic relationships elucidated by this study provide evidence to support the establishment of two additional sections, Flavida and Viridis, which are described.