Encelia, Enceliopsis, and Geraea are three closely related genera of shrubs and herbs distributed in the arid lands of western North and South America. Resolution of relationships within Encelia has traditionally been difficult because there is some morphological overlap among species, and species hybridize when sympatric. In this study, we used DNA sequence data from two nuclear regions (ITS and ETS) and two chloroplast regions (psbA-trnH and trnS-trnfM) to infer phylogenetic relationships among 19 species, subspecies, and varieties of Encelia. Eight species of Enceliopsis, Geraea, Simsia, and Bahiopsis were also included as outgroups. These data support previous hypotheses suggesting that Encelia is monophyletic and sister to Enceliopsis Geraea. In addition, our data provide evidence for two major subclades within Encelia that are supported by morphological synapomorphies. However, little differentiation was observed among species of Encelia within subclades. This lack of differentiation may be the result of a recent diversification of the genus including recent radiation in the Peninsular Desert.