Mutation and subsequent recombination events create genetic diversity, which is subjected to natural selection. Bacterial mismatch repair (MMR) deficient mutants, exhibiting high mutation and homologous recombination rates, are frequently found in natural populations. Therefore, we have explored the possibility that MMR deficiency emerging in nature has left some "imprint" in the sequence of bacterial genomes. Comparative molecular phylogeny of MMR genes from natural Escherichia coli isolates shows that, compared to housekeeping genes, individual functional MMR genes exhibit high sequence mosaicism derived from diverse phylogenetic lineages. This apparent horizontal gene transfer correlates with hyperrecombination phenotype of MMR-deficient mutators. The sequence mosaicism of MMR genes may be a hallmark of a mechanism of adaptive evolution that involves modulation of mutation and recombination rates by recurrent losses and reacquisitions of MMR gene functions.