Monocots are one of the most diverse groups of flowering plants, and tracing the evolution of their ancestral genome into modern species is essential for understanding their evolutionary success. Here, we report a high-quality assembly of the Acorus tatarinowii genome, a species that diverged early from all the other monocots. Genome-wide comparisons with a range of representative monocots characterized Acorus as a slowly evolved genome with one whole-genome duplication. Our inference of the ancestral monocot karyotypes provides new insights into the chromosomal evolutionary history assigned to modern species and reveals the probable molecular functions and processes related to the early adaptation of monocots to wetland or aquatic habitats (that is, low levels of inorganic phosphate, parallel leaf venation and ephemeral primary roots). The evolution of ancestral gene order in monocots is constrained by gene structural and functional features. The newly obtained Acorus genome offers crucial evidence for delineating the origin and diversification of monocots, including grasses.