The unique anatomical features of turtles have raised unanswered questions about the origin of their unique body plan. We generated and analyzed draft genomes of the soft-shell turtle (Pelodiscus sinensis) and the green sea turtle (Chelonia mydas); our results indicated the close relationship of the turtles to the bird-crocodilian lineage, from which they split ∼267.9-248.3 million years ago (Upper Permian to Triassic). We also found extensive expansion of olfactory receptor genes in these turtles. Embryonic gene expression analysis identified an hourglass-like divergence of turtle and chicken embryogenesis, with maximal conservation around the vertebrate phylotypic period, rather than at later stages that show the amniote-common pattern. Wnt5a expression was found in the growth zone of the dorsal shell, supporting the possible co-option of limb-associated Wnt signaling in the acquisition of this turtle-specific novelty. Our results suggest that turtle evolution was accompanied by an unexpectedly conservative vertebrate phylotypic period, followed by turtle-specific repatterning of development to yield the novel structure of the shell.