Abstract Background Staphylococcus belongs to the Gram-positive low G + C content group of the Firmicutes division of bacteria. Staphylococcus aureus is an important human and veterinary pathogen that causes a broad spectrum of diseases, and has developed important multidrug resistant forms such as methicillin-resistant S. aureus (MRSA). Staphylococcus simiae was isolated from South American squirrel monkeys in 2000, and is a coagulase-negative bacterium, closely related, and possibly the sister group, to S. aureus. Comparative genomic analyses of closely related bacteria with different phenotypes can provide information relevant to understanding adaptation to host environment and mechanisms of pathogenicity. Results We determined a Roche/454 draft genome sequence for S. simiae and included it in comparative genomic analyses with 11 other Staphylococcus species including S. aureus. A genome based phylogeny of the genus confirms that S. simiae is the sister group to S. aureus and indicates that the most basal Staphylococcus lineage is Staphylococcus pseudintermedius, followed by Staphylococcus carnosus. Given the primary niche of these two latter taxa, compared to the other species in the genus, this phylogeny suggests that human adaptation evolved after the split of S. carnosus. The two coagulase-positive species (S. aureus and S. pseudintermedius) are not phylogenetically closest but share many virulence factors exclusively, suggesting that these genes were acquired by horizontal transfer. Enrichment in genes related to mobile elements such as prophage in S. aureus relative to S. simiae suggests that pathogenesis in the S. aureus group has developed by gene gain through horizontal transfer, after the split of S. aureus and S. simiae from their common ancestor. Conclusions Comparative genomic analyses across 12 Staphylococcus species provide hypotheses about lineages in which human adaptation has taken place and contributions of horizontal transfer in pathogenesis.