We sequenced and compared the genomes of the Dothideomycete fungal plant pathogens Cladosporium fulvum (Cfu) (syn. Passalora fulva) and Dothistroma septosporum (Dse) that are closely related phylogenetically, but have different lifestyles and hosts. Although both fungi grow extracellularly in close contact with host mesophyll cells, Cfu is a biotroph infecting tomato, while Dse is a hemibiotroph infecting pine. The genomes of these fungi have a similar set of genes (70% of gene content in both genomes are homologs), but differ significantly in size (Cfu >61.1-Mb; Dse 31.2-Mb), which is mainly due to the difference in repeat content (47.2% in Cfu versus 3.2% in Dse). Recent adaptation to different lifestyles and hosts is suggested by diverged sets of genes. Cfu contains an alpha-tomatinase gene that we predict might be required for detoxification of tomatine, while this gene is absent in Dse. Many genes encoding secreted proteins are unique to each species and the repeat-rich areas in Cfu are enriched for these species-specific genes. In contrast, conserved genes suggest common host ancestry. Homologs of Cfu effector genes, including Ecp2 and Avr4, are present in Dse and induce a Cf-Ecp2- and Cf-4-mediated hypersensitive response, respectively. Strikingly, genes involved in production of the toxin dothistromin, a likely virulence factor for Dse, are conserved in Cfu, but their expression differs markedly with essentially no expression by Cfu in planta. Likewise, Cfu has a carbohydrate-degrading enzyme catalog that is more similar to that of necrotrophs or hemibiotrophs and a larger pectinolytic gene arsenal than Dse, but many of these genes are not expressed in planta or are pseudogenized. Overall, comparison of their genomes suggests that these closely related plant pathogens had a common ancestral host but since adapted to different hosts and lifestyles by a combination of differentiated gene content, pseudogenization, and gene regulation.