Biologists are amazed by the intricacy and complexity of biological interactions between molecules, cells, organisms, and ecosystems. Yet underlying all this biodiversity is a universal common ancestry. How does evolution proceed from common starting points to generate the riotous biodiversity we see today? This "novelty problem"-understanding how novelty and common ancestry relate-has become of critical importance, especially since the realization that genes and developmental processes are often conserved across vast phylogenetic distances. In particular, two processes have emerged as the primary generators of diversity in organismal form: duplication plus divergence and co-option. In this article, we first illustrate how phylogenetic methodology and "tree-thinking" can be used to distinguish duplication plus divergence from co-option. Second, we review two case studies in photoreceptor evolution-one suggesting a role for duplication plus divergence, the other exemplifying how co-option can shape evolutionary change. Finally, we discuss how our tree-thinking approach differs from other treatments of the origin of novelty that utilized a "linear-thinking" approach in which evolution is viewed as a linear and gradual progression, often from simple to complex phenotype, driven by natural selection.