Invertebrates can acquire functional genes via horizontal gene transfer (HGT) from bacteria but fishes are not known to do so. We provide the first reliable evidence of one HGT event from marine bacteria to fishes. The HGT appears to have occurred after emergence of the teleosts. The transferred gene is expressed and regulated developmentally. Its successful integration and expression may change the genetic and metabolic repertoire of fishes. In addition, this gene contains conserved domains and similar tertiary structures in fishes and their putative donor bacteria. Thus, it may function similarly in both groups. Evolutionary analyses indicate that it evolved under purifying selection, further indicating its conserved function. We document the first likely case of HGT of functional gene from prokaryote to fishes. This discovery certifies that HGT can influence vertebrate evolution.