The DNA of most vertebrates is depleted in CpG dinucleotides, the target for DNA methylation. The remaining CpGs tend to cluster in regions referred to as CpG islands (CGI). CGI have been useful as marking functionally relevant epigenetic loci for genome studies. For example, CGI are enriched in the promoters of vertebrate genes and thought to play an important role in regulation. Currently, CGI are defined algorithmically as an observed-to-expected ratio (O/E) of CpG greater than 0.6, G+C content greater than 0.5, and usually but not necessarily greater than a certain length. Here we find that the current definition leaves out important CpG clusters associated with epigenetic marks, relevant to development and disease, and does not apply at all to nonvertabrate genomes. We propose an alternative Hidden Markov model-based approach that solves these problems. We fit our model to genomes from 30 species, and the results support a new epigenomic view toward the development of DNA methylation in species diversity and evolution. The O/E of CpG in islands and nonislands segregated closely phylogenetically and showed substantial loss in both groups in animals of greater complexity, while maintaining a nearly constant difference in CpG O/E between islands and nonisland compartments. Lists of CGI for some species are available at http://www.rafalab.org .