Abstract Background Streptococcus canis is an important opportunistic pathogen of dogs and cats that can also infect a wide range of additional mammals including cows where it can cause mastitis. It is also an emerging human pathogen. Results Here we provide characterization of the first genome sequence for this species, strain FSL S3-227 (milk isolate from a cow with an intra-mammary infection). A diverse array of putative virulence factors was encoded by the S. canis FSL S3-227 genome. Approximately 75% of these gene sequences were homologous to known Streptococcal virulence factors involved in invasion, evasion, and colonization. Present in the genome are multiple potentially mobile genetic elements (MGEs) [plasmid, phage, integrative conjugative element (ICE)] and comparison to other species provided convincing evidence for lateral gene transfer (LGT) between S. canis and two additional bovine mastitis causing pathogens (Streptococcus agalactiae, and Streptococcus dysgalactiae subsp. dysgalactiae), with this transfer possibly contributing to host adaptation. Population structure among isolates obtained from Europe and USA [bovine = 56, canine = 26, and feline = 1] was explored. Ribotyping of all isolates and multi locus sequence typing (MLST) of a subset of the isolates (n = 45) detected significant differentiation between bovine and canine isolates (Fisher exact test: P = 0.0000 [ribotypes], P = 0.0030 [sequence types]), suggesting possible host adaptation of some genotypes. Concurrently, the ancestral clonal complex (54% of isolates) occurred in many tissue types, all hosts, and all geographic locations suggesting the possibility of a wide and diverse niche. Conclusion This study provides evidence highlighting the importance of LGT in the evolution of the bacteria S. canis, specifically, its possible role in host adaptation and acquisition of virulence factors. Furthermore, recent LGT detected between S. canis and human bacteria (Streptococcus urinalis) is cause for concern, as it highlights the possibility for continued acquisition of human virulence factors for this emerging zoonotic pathogen.