Spiroplasma is a genus of Mollicutes whose members include plant pathogens, insect pathogens and endosymbionts of animals. Spiroplasma phenotypes have been repeatedly observed to be spontaneously lost in Drosophila cultures, and several studies have documented a high genomic turnover in Spiroplasma symbionts and plant pathogens. These observations suggest that Spiroplasma evolves quickly in comparison to other insect symbionts. Here, we systematically assess evolutionary rates and patterns of Spiroplasma poulsonii, a natural symbiont of Drosophila. We analysed genomic evolution of sHy within flies, and sMel within in vitro culture over several years. We observed that S. poulsonii substitution rates are among the highest reported for any bacteria, and around two orders of magnitude higher compared with other inherited arthropod endosymbionts. The absence of mismatch repair loci mutS and mutL is conserved across Spiroplasma, and likely contributes to elevated substitution rates. Further, the closely related strains sMel and sHy (>99.5 % sequence identity in shared loci) show extensive structural genomic differences, which potentially indicates a higher degree of host adaptation in sHy, a protective symbiont of Drosophila hydei. Finally, comparison across diverse Spiroplasma lineages confirms previous reports of dynamic evolution of toxins, and identifies loci similar to the malekilling toxin Spaid in several Spiroplasma lineages and other endosymbionts. Overall, our results highlight the peculiar nature of Spiroplasma genome evolution, which may explain unusual features of its evolutionary ecology.