The grasses (Poaceae) are the fifth most diverse family of angiosperms, including 800 genera and more than 10 000 species. Few phylogenetic studies have tried to investigate palaeo-biogeographical and palaeo-ecological scenarios that may have led to present-day distribution and diversity of grasses at the family level. We produced a dated phylogenetic tree based on combined plastid DNA sequences and a comprehensive sample of Poaceae. Furthermore, we produced an additional tree using a supermatrix of morphological and molecular data that included all 800 grass genera so that ancestral biogeography and ecological habitats could be inferred. We used a likelihood-based method, which allows the estimation of ancestral polymorphism in both biogeographical and ecological analyses for large data sets. The origin of Poaceae was retrieved as African and shade adapted. The crown node of the BEP + PACCMAD clade was dated at 57 Mya, in the early Eocene. Grasses dispersed to all continents by approximately 60 million years after their Gondwanan origin in the late Cretaceous. PACCMAD taxa adapted to open habitats as early as the late Eocene, a date consistent with recent phytolith fossil data for North America. C4 photosynthesis first originated in Africa, at least for Chloridoideae in the Eocene at c. 30 Mya. The BEP clade members adapted to open habitats later than PACCMAD members; this was inferred to occur in Eurasia in the Oligocene. © 2010 The Linnean Society of London, Botanical Journal of the Linnean Society, 2010, 162, 543–557.