Ribosomal gene sequence data are used to explore phylogenetic relationships among higher arthropod groups. Sequences of 139 taxa (23 outgroup and 116 ingroup taxa) representing all extant arthropod “classes” except Remipedia and Cephalocarida are analyzed using direct character optimization exploring six parameter sets. Parameter choice appears to be crucial to phylogenetic inference. The high level of sequence heterogeneity in the 18S rRNA gene (sequence length from 1350 to 2700 bp) makes placement of certain taxa with “unusual” sequences difficult and underscores the necessity of combining ribosomal gene data with other sources of information. Monophyly of Pycnogonida, Chelicerata, Chilopoda, Chilognatha, Malacostraca, Branchiopoda (excluding Daphnia), and Ectognatha are among the higher groups that are supported in most of the analyses. The positions of the Pauropoda, Symphyla, Protura, Collembola, Diplura, Onychophora, Tardigrada, and Daphnia are unstable throughout the parameter space examined.