What factors drove the transformation of the cyanobacterial progenitor of plastids (e.g. chloroplasts) from endosymbiont to bona fide organelle? This question lies at the heart of organelle genesis because, whereas intracellular endosymbionts are widespread in both unicellular and multicellular eukaryotes (e.g. rhizobial bacteria, Chlorella cells in ciliates, Buchnera in aphids), only two canonical eukaryotic organelles of endosymbiotic origin are recognized, the plastids of algae and plants and the mitochondrion. Emerging data on (1) the discovery of non-canonical plastid protein targeting, (2) the recent origin of a cyanobacterial-derived organelle in the filose amoeba Paulinella chromatophora, and (3) the extraordinarily reduced genomes of psyllid bacterial endosymbionts begin to blur the distinction between endosymbiont and organelle. Here we discuss the use of these terms in light of new data in order to highlight the unique aspects of plastids and mitochondria and underscore their central role in eukaryotic evolution. BioEssays 29:1239–1246, 2007. © 2007 Wiley Periodicals, Inc.