Obligate insect-bacterium nutritional mutualism is among the most sophisticated forms of symbiosis, wherein the host and the symbiont are integrated into a coherent biological entity and unable to survive without the partnership. Originally, however, such obligate symbiotic bacteria must have been derived from free-living bacteria. How highly specialized obligate mutualisms have arisen from less specialized associations is of interest. Here we address this evolutionary issue by focusing on an exceptional insect-Wolbachia nutritional mutualism. Although Wolbachia endosymbionts are ubiquitously found in diverse insects and generally regarded as facultative/parasitic associates for their insect hosts, a Wolbachia strain associated with the bedbug Cimex lectularius, designated as wCle, was shown to be essential for host's growth and reproduction via provisioning of B vitamins. We determined the 1,250,060-bp genome of wCle, which was generally similar to the genomes of insect-associated facultative Wolbachia strains, except for the presence of an operon encoding the complete biotin synthetic pathway that was acquired via lateral gene transfer presumably from a coinfecting endosymbiont Cardinium or Rickettsia. Nutritional and physiological experiments, in which wCle-infected and wCle-cured bedbugs of the same genetic background were fed on B-vitamin-manipulated blood meals via an artificial feeding system, demonstrated that wCle certainly synthesizes biotin, and the wCle-provisioned biotin significantly contributes to the host fitness. These findings strongly suggest that acquisition of a single gene cluster consisting of biotin synthesis genes underlies the bedbug-Wolbachia nutritional mutualism, uncovering an evolutionary transition from facultative symbiosis to obligate mutualism facilitated by lateral gene transfer in an endosymbiont lineage.