Seaweeds are essential for marine ecosystems and have immense economic value. Here we present a comprehensive analysis of the draft genome of Saccharina japonica, one of the most economically important seaweeds. The 537-Mb assembled genomic sequence covered 98.5% of the estimated genome, and 18,733 protein-coding genes are predicted and annotated. Gene families related to cell wall synthesis, halogen concentration, development and defence systems were expanded. Functional diversification of the mannuronan C-5-epimerase and haloperoxidase gene families provides insight into the evolutionary adaptation of polysaccharide biosynthesis and iodine antioxidation. Additional sequencing of seven cultivars and nine wild individuals reveal that the genetic diversity within wild populations is greater than among cultivars. All of the cultivars are descendants of a wild S. japonica accession showing limited admixture with S. longissima. This study represents an important advance toward improving yields and economic traits in Saccharina and provides an invaluable resource for plant genome studies.