Soil-transmitted nematodes, including the Strongyloides genus, cause one of the most prevalent neglected tropical diseases. Here we compare the genomes of four Strongyloides species, including the human pathogen Strongyloides stercoralis, and their close relatives that are facultatively parasitic (Parastrongyloides trichosuri) and free-living (Rhabditophanes sp. KR3021). A significant paralogous expansion of key gene families--families encoding astacin-like and SCP/TAPS proteins--is associated with the evolution of parasitism in this clade. Exploiting the unique Strongyloides life cycle, we compare the transcriptomes of the parasitic and free-living stages and find that these same gene families are upregulated in the parasitic stages, underscoring their role in nematode parasitism.