The relationships of major arthropod clades have long been contentious, but refinements in molecular phylogenetics underpin an emerging consensus. Nevertheless, molecular phylogenies have recovered topologies that morphological phylogenies have not, including the placement of hexapods within a paraphyletic Crustacea, and an alliance between myriapods and chelicerates. Here we show enhanced congruence between molecular and morphological phylogenies based on 753 morphological characters for 309 fossil and Recent panarthropods. We resolve hexapods within Crustacea, with remipedes as their closest extant relatives, and show that the traditionally close relationship between myriapods and hexapods is an artefact of convergent character acquisition during terrestrialisation. The inclusion of fossil morphology mitigates long-branch artefacts as exemplified by pycnogonids: when fossils are included, they resolve with euchelicerates rather than as a sister taxon to all other euarthropods.