Alternative splicing (AS) diversifies transcriptomes and proteomes and is widely recognized as a key mechanism for regulating gene expression. Previously, in an analysis of intron retention events in Arabidopsis, we found unusual AS events inside annotated protein-coding exons. Here, we also identify such AS events in human and use these two sets to analyse their features, regulation, functional impact, and evolutionary origin. As these events involve introns with features of both introns and protein-coding exons, we name them exitrons (exonic introns). Though exitrons were detected as a subset of retained introns, they are clearly distinguishable, and their splicing results in transcripts with different fates. About half of the 1002 Arabidopsis and 923 human exitrons have sizes of multiples of 3 nucleotides (nt). Splicing of these exitrons results in internally deleted proteins and affects protein domains, disordered regions, and various post-translational modification sites, thus broadly impacting protein function. Exitron splicing is regulated across tissues, in response to stress and in carcinogenesis. Intriguingly, annotated intronless genes can be also alternatively spliced via exitron usage. We demonstrate that at least some exitrons originate from ancestral coding exons. Based on our findings, we propose a “splicing memory” hypothesis whereby upon intron loss imprints of former exon borders defined by vestigial splicing regulatory elements could drive the evolution of exitron splicing. Altogether, our studies show that exitron splicing is a conserved strategy for increasing proteome plasticity in plants and animals, complementing the repertoire of AS events.